Asian currencies little changed as USD holds near 99.7 (7-week low). Iran-Oman Hormuz progress eyed; Australia trade surplus A$1.93B; RBI holds repo at 5.25%. Focus on U.S. jobless claims and NFP.
Asian currencies traded little changed on Thursday while the U.S. dollar hovered near a seven-week low around 99.7 on the Dollar Index, as investors monitored fragile Middle East peace negotiations and awaited key U.S. labor data for clues on the Federal Reserve’s rate path. Caution prevailed amid mixed signals on a possible Strait of Hormuz reopening and softer recent U.S. employment readings.
Dollar Near 99.7; Yen Flat at 157.7 as Australia Posts A$1.93B Trade Surplus
The U.S. Dollar Index held near 99.7 (around 99.64–99.76 intraday), after sliding to its weakest level since mid-June in the prior session. USD/JPY traded flat near 157.7 following recent intervention-supported gains. Onshore USD/CNY was little changed around 6.7895 (central parity), with offshore USD/CNH similarly steady. USD/KRW edged 0.1% lower, while AUD/USD ticked down 0.1% near 0.705. The Indian rupee was among the firmer Asian currencies, having strengthened in five of the last seven sessions; USD/INR had fallen 0.3% in the prior session after the Reserve Bank of India held the repo rate at 5.25%. Singapore’s USD/SGD was largely muted.
Iran said it had reached a preliminary understanding with Oman on a proposed shipping route through the Strait of Hormuz (which handles roughly a fifth of global oil shipments), with a joint announcement in the final stages, though contentious issues remain. U.S. President Donald Trump described a deal as imminent, but Tehran insisted it was negotiating only with Oman, not Washington. Oil prices stayed range-bound after sharp earlier-week losses (WTI near the mid-$70s, Brent near $79).
Australia’s June trade balance swung to a surplus of A$1.93 billion (versus a revised A$2.37 billion deficit in May and expectations of a deficit near A$1.1 billion). Exports rose 9.6% to A$47.70 billion, driven by non-monetary gold, while imports eased 0.2% to A$45.77 billion.
Hormuz Hopes, Soft ADP (+44K) Weigh on Dollar; Asian FX Sees Selective Support
Optimism over a possible Hormuz reopening reduced energy-price and inflation fears, weighing on the dollar and supporting some Asian currencies (especially oil-importers such as the rupee). Fragile talks and unresolved issues kept traders from aggressive positioning. Soft recent U.S. labor data (ADP private payrolls +44,000 in July) and mixed ISM readings further limited dollar strength. BOJ rate-hike signals and RBI’s steady policy provided selective local support, but overall risk caution capped moves.
DXY 52-Week Range 95.55–101.80; RBI 4th Hold at 5.25% as Hormuz Risks Linger
The Dollar Index has traded in a 52-week range of roughly 95.55–101.80. Asian FX has been sensitive to Middle East developments that affect oil prices and global risk sentiment. Recent joint U.S.-Japan intervention helped stabilize the yen after sharp weakness. The RBI’s fourth consecutive hold at 5.25% reflected a neutral stance amid global uncertainty. Australia’s trade rebound was driven by gold shipments amid higher commodity prices linked to regional tensions. Markets remain focused on whether Hormuz shipping can normalize and on U.S. labor data that could shift Fed pricing (currently leaning toward possible year-end hikes).
Focus on U.S. Jobless Claims, NFP and Hormuz Deal for Next FX Moves
Thursday’s U.S. weekly jobless claims and Friday’s Nonfarm Payrolls report will be the key near-term catalysts for the dollar and Asian FX. Any formal Hormuz announcement (or setback) could swing oil prices and risk appetite. BOJ policy signals and further RBI commentary may influence the yen and rupee. Traders will watch for directional breaks once U.S. data clarity emerges.