Weekly currency forecast: Hawkish Fed minutes to catapult USD higher?

Roxane Cody February 19th 2024 - 2 minute read

Last week brought volatility to the currency market as the latest UK and US data surprised investors, triggering some big swings in both the pound and the US dollar.

This week the Federal Reserve, European Central Bank (ECB), and Reserve Bank of Australia (RBA) are all set to release the meeting minutes from their most recent interest rate decisions. Any insights into their policy plans could impact the respective currencies.


The pound spiked early last week following stronger-than-expected jobs data. However, weaker inflation and GDP data saw Sterling then trend lower, with markets ramping up Bank of England (BoE) interest rate cut bets as the UK slipped into a recession last year.

This week, the focus is on the preliminary PMI results for February. Another strong services reading could support the pound. However, if the surveys show signs of easing inflation then GBP’s upside may be limited.


Dovish comments from a European Central Bank (ECB) official dented the euro last week. Some upbeat economic data then helped the currency recover, while EUR’s negative correlation with USD drove volatility.

The single currency could face renewed pressure this week amid the latest PMI results and the ECB’s policy meeting minutes. An ongoing contraction in business activity and any hints at coming rate cuts may push EUR lower.

US dollar

Hotter-than-forecast US inflation saw the US dollar surge last week. However, the ‘greenback’ relinquished most of its gains by the end of the week amid an improving market mood and dismal domestic sales data.

In the spotlight this week will be the minutes from the Federal Reserve’s most recent policy meeting. If the accounts show that policymakers are dismissive of rate cuts, USD could jump.

Australian dollar

The risk-sensitive Australian dollar plunged last week as an anxious mood gripped markets. AUD was able to recover through the second part of the session, despite weaker jobs data, as risk appetite returned.

This week, the Reserve Bank of Australia (RBA) meeting minutes are due out. If they reveal that policymakers remain open to another interest rate hike, the ‘Aussie’ could climb.

Written by
Roxane Cody

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