(adds link in 1st bullet)

• Cable fell to 1.31635 in Asia, its lowest level since March 31, on further USD buying

• 1.31635 is 3.5 pips shy of March 31 base (lowest level since November 2025)

• GBP/USD was on 1.34 handle before dollar jumped on Warsh-led Fed's hawkish hold

• 1.3193 was Thursday low, after BoE's relatively dovish hold (1.3225 was pre-BoE low)

• Burnham wins UK by-election with 54.8% of vote; sets up bid to oust PM Starmer

• UK May budget deficit much bigger than expected; retail sales up 1.2% vs 0.5% f/c

GBPUSD


(Robert Howard is a Reuters market analyst. The views expressed are his own)

• FX options expire at 10am New York/15:00 GMT on Friday June 19

• EUR/USD: 1.1350 (1.1B), 1.1400 (300M), 1.1410-15 (357M), 1.1425 (206M), 1.1440 (310M), 1.1450 (1.8B), 1.1470-75 (560M)

• EUR/USD: 1.1490 (1.1B), 1.1500-05 (3.5B), 1.1520-25 (2.0B), 1.1530-35 (1.0B), 1.1540-45 (634M), 1.1550-55 (2.9B)

• EUR/USD: 1.1560-65 (422M), 1.1570-75 (1.4B), 1.1600-05 (805M), 1.1650-55 (1.1B)

• USD/JPY: 160.75-80 (317M), 161.0000 (279M), 161.50 (276M), 161.75-80 (401M), 162.00 (411M), 162.50 (215M)

• GBP/USD: 1.3250 (200M), 1.3350 (323M). EUR/GBP: 0.8630-35 (284M), 0.8660-65 (202M), 0.8680-85 (206M), 0.8750 (256M)

• USD/CHF: 0.7900 (621M), 0.7925-30 (378M), 0.7980 (594M)

• AUD/USD: 0.6995-00 (438M), 0.7035-40 (321M), 0.7045-50 (323M), 0.7055 (385M), 0.7075-80 (212M), 0.7175-80 (721M)

• NZD/USD: 0.5800 (351M), 0.5840 (248M), 0.5880 (299M), 0.5935 (243M), 0.6000 (250M)

• USD/CAD: 1.3960-65 (282M), 1.3970-75 (547M), 1.4000 (621M), 1.4030-35 (639M)
(Martin Miller is a Reuters market analyst. The views expressed are his own)

• USD/JPY on back foot after surge to 161.81 EBS overnight, Asia 160.99-161.41

• Profit-taking by longs, defence of option KOs at 162.00, exporters tipped

• Japan FX intervention threat too, fresh jaw-boning from FinMin Katayama

• BOJ DepGov Himino hawkish in Diet testimony, April 27-28 minutes hawkish too

• Pre-weekend Tokyo fix Japan importer demand with Gotobi falling on Saturday

• Foreign investor currency hedging of Japan equity buys continuing

• Japanese retail investor foreign currency demand too, NISA and other flows

• Support now seen from around 161.00, 161 the 'new' 160 after 159?

• JPY crosses on back feet with USD gains against other majors even larger

• EUR/JPY 184.58-90 EBS in Asia, at lower end of recent 184.00-186.31 range

• Ensconced in 184.36-95 daily Ichimoku cloud, 185.33-43 hourly cloud cap?

• GBP/JPY 213.28 to 212.57 in Asia after fall to 212.42 yesterday

• Looking to hold below 212.84-213.03 daily Ichimoku cloud now

• CHF/JPY 200.67 to 199.84 in Asia, continuing moves lower from overnight

• Now clear of 200.94-201.03 daily Ichimoku cloud above

• AUD/JPY 112.82-113.28, now ensconced in 111.73-113.21 daily Ichimoku cloud

• Pivoting around 112.90 200-HMA, 112.89-99 hourly Ichi cloud

• NZD/JPY 93.02 to 92.51 in Asia, to base of 92.47-93 daily Ichimoku cloud

• Capped by 92.92-93.07 descending hourly Ichimoku cloud, 100-DMA at 93.11

• Related comment , also ,

• On BOJ Himino/minutes ,

• FinMin Katayama-speak , on Japan CPI
USD/JPY hourly:


EUR/JPY hourly:


AUD/JPY hourly:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• GBP/USD -0.15% in Asia Fri as leadership challenge brews and USD firms

• Andy Burnham's election clears route to oust UK Prime Minister Starmer

• BoE votes 7-2 to keep 3.75% policy rate on hold, wary of climbing inflation

• USD index hits 100.92 13-month high as Strait of Hormuz oil starts moving

• Increasing probability of Fed rate hikes underpins strengthening USD

• GBP downside extension in full swing, 1.3160 now looks like easy target

• UK May retail sales due Fri, Reuters poll consensus +0.5% m/m, +1.9% y/y

• Range Asia 1.3186-1.3211, support 1.3160 1.3040, resistance 1.3867 1.4250
GBP Daily 55-DMA


DXY Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• NZD/USD flatlines Fri as broad USD index remains elevated in Asia

• NZ balance of trade +0.8 bln in May, annual deficit 3.4 bln (prior -2.8 bln)

• Ratcheting Fed rate-hike bets post-Fed's hawkish hold underpins USD rally

• USD index reaches highest level since May 2025, hits 100.92 overnight

• Traffic begins to flow through Strait of Hormuz following U.S.-Iran deal

• U.S. initial jobless claims +226k, Reuters poll consensus +225k

• NZD remains under pressure overall, targeting 0.5680 support zone

• Range Asia 0.5748-599, support 0.5680 5580, resistance 0.5990-95 0.6012
NZD Daily 55-DMA


DXY Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• Australian gold stocks fall as much as 2.9%, on track for their second consecutive session of losses, if trend holds

• Bullion prices fell overnight, pressured by hawkish policy signals from the U.S. Federal Reserve and a stronger dollar [GOL/]

• Shares of gold miners Northern Star Resources and Evolution Mining down 2.2% and 3.8%, respectively

• However, sub-index on track for its best week since mid-August 2025

• .AXGD down 10.1% this year, including session moves

(Reporting by Roshan Thomas in Bengaluru)

• USD surged across the board yesterday on hawkish Fed expectations

• USD/JPY as high as 161.81, Japan's MOF conspicuous in absence on FX action

• USD/JPY highest since 161.96 recorded on July 3, 2024

• Asia so far today 161.18-41 EBS, 161 handle the new 160?

• Threat of intervention still especially ahead of massive 162.00 option KOs

• Break above 162.00 could see USD/JPY shoot up towards 165.00

• Even more option KOs tipped at this level, Japan importers stops above both

• In expiries, little nearby today but massive Monday - 160.00, 161.00, 163.00

• JGB-US Treasury rate differentials wider in 2s at @277, 10s still @183 bps

• Japanese importer demand likely strong at pre-weekend Tokyo fix

• This especially with Gotobi falling on Saturday, USD/JPY downside limited?

• Related comments , , ,

• Also , on US economic data ,

• US markets , , ,

• On foreign holdings of US debt ,
USD/JPY:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

Goldman Sachs Research summarizes its latest Fed and ECB calls following the June policy meetings.

"We expect the Fed to leave the policy rate unchanged at 3.5-3.75% this year, though the hawkish June FOMC meeting raises the risk of interest rate hikes later this year," GS notes.

"We expect the ECB to deliver one more 25bp hike in September to a peak policy rate of 2.5% before cutting back to 2% in 2027," GS adds.

• AUD/USD +0.1% late Thur despite Fed rate-hike bets invigorating USD buyers

• Broad USD index reaches 100.92, highest level since May 2025

• Traffic begins to flow through Strait of Hormuz following U.S.-Iran deal

• Short-term AUD support forms 0.6995-00, but 0.7089 likely to cap rallies

• U.S. initial jobless claims +226k, Reuters poll consensus +225k

• Overnight Range 0.7001-39, support 0.6995 0.6834, resistance 0.7089 0.7200
DXY Daily 55-DMA


AUD Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

The dollar index rose to a one-year high on Thursday, extending gains made on hawkish interpretations of Fed Chair Kevin Warsh's first policy meeting, to about 1.3%.

U.S. data did little to undermine the rally, with weekly jobless claims easing more or less as expected, though continued claims rose more than expected.

The Philly Fed business index rebounded slightly more than expected, with employment, prices paid and new orders all rising. The Conference Board's Leading Economic index came in as expected with a slight revision higher. Some 12.5 million barrels of crude sailed through the Strait of Hormuz overnight, U.S. Vice President JD Vance said, but in Lebanon, Israeli forces launched fresh airstrikes early on Thursday, potentially raising some doubts about the path to permanent peace.

The Bank of England kept interest rates on hold at 3.75%, as it has since the start of the U.S.-Iran war, judging it would be premature to raise rates now given uncertainty about the strength of increased inflation pressures. GBP/USD softened on dovish interpretations of the BoE's decision to hold rates steady and event risk as the northern English area of Makerfield voted in a local election that could return Greater Manchester Mayor Andy Burnham to parliament, paving the way for him to launch a bid to take over as prime minister. AUD/USD managed to overcome the robust U.S. dollar with the help of yen sales that propelled AUD/JPY higher. EUR/USD hit a 2-1/2-month low of 1.1454, with techs leaning bearish. USD/JPY surged past 161 to a 2026 high at the London close as U.S. shares advanced.

The S&P 500 was trading 1.04% higher in New York afternoon with semiconductor shares leading gains as optimism about a Middle East peace deal offset worries about a hawkish Federal Reserve under new Chair Kevin Warsh.

WTI crude oil fell 0.7%, touching its lowest since early in the Iran war as the interim deal to end fighting and reopen the Strait of Hormuz boosted the global supply outlook.

Copper was down 1.52% and gold fell 0.78%, both undermined by the stronger dollar.

Heading toward the close: EUR/USD -0.32%, USD/JPY +0.48%, GBP/USD -0.66%, AUD/USD +0.06%, =USD +0.45%, EUR/JPY +0.18%, GBP/JPY -0.13%, AUD/JPY +0.54%.(Robert Fullem)

• NY opened near 0.7010 after 0.7042 traded overnight, pair's slide extended early

• 0.7001 hit as USD was bought, USD/CNH rallied & gold, silver turned lower

• AUD/USD buyers emerged however and the pair turned positive, 0.7040 was neared

• AUD/JPY rally above 113.35, equity gains, US yield

drop buoyed AUD/USD

• The pair dipped and sat near 0.7025 late in the session, AUD/UDS traded up +0.16%

• Daily RSI is rising but the pair remains below the 10- & 21-DMAs; monthly RSI is falling
audusd


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Danske Research reviews today's June BoE meeting.

"The Bank of England (BoE) kept Bank Rate unchanged at 3.75% as widely expected. The decision was taken with a 7-2 vote, with Pill and now also Greene voting for a hike to "insure against the possibility of larger second-round effects". Mann, although not voting for hike, was singled out with more inflation worries than the rest of the hold camp. Convinced, "a forceful Bank Rate decision can have a quick effect on inflation and inflation expectations", she stuck with a hold decision. The deciding vote is often Governor Bailey's and as he puts it, he is "content at the present time with holding"," Danske notes.

"The meeting today has not changed our view that the most likely outcome is an unchanged Bank Rate for the coming year. Although, core PPI inflation remains quite modest, risks to the inflation outlook remains to the upside given businesses' intention to increase prices quite steeply according to the PMI survey. An uncomfortable period with elevated inflation also lies ahead due to increased energy price caps. The slowing economy, cooling labour market and now also lower oil prices suggest that core price pressures will not increase more than what the BoE will accept, though," Danske adds.

Sterling faces an increasingly challenging near-term outlook, navigating a fluid monetary policy landscape and lingering geopolitical risks as dollar strength and domestic political risks weigh on the pair.

Wednesday's signing of the U.S.-Iran memorandum of understanding, aimed at ending regional hostilities and reopening the Strait of Hormuz to shipping, offers a tentative glimmer of hope for alleviating persistent UK and global inflation. Should improved shipping conditions materialise, they could, in time, allow the Bank of England (BoE) and other central banks to begin lowering rates to stimulate growth. However, immediate headwinds remain formidable. The Federal Reserve held rates steady as expected but struck a decidedly hawkish tone, with members signaling a potential rate hike into year-end 2026. Markets have interpreted this as possibly more than one 25 basis point increase, catapulting the dollar higher and pressuring GBP/USD through the key 1.33 support level. Today's BoE rate hold, while couched in somewhat more cautious language, offers limited offsetting support. The central bank has adopted a decidedly more reserved near-term outlook on rates — a narrative reinforced by recent below-forecast UK CPI data that, for now, keeps the BoE firmly in wait-and-see mode. Adding to sterling's vulnerability, today's Makerfield by-election presents potential political and fiscal risks for GBP/USD.

Technically, with 1.33 broken, traders now look to Thursday's low at 1.3206 as immediate support, followed by the 100-week moving average at 1.3188. To the upside, resistance sits at the falling 21-day moving average at 1.3405 and the 100-day moving average at 1.3454.
Sterling Chart:


(Paul Spirgel is a Reuters market analyst. The views expressed are his own)

JP Morgan Research reviews yesterday's June FOMC meeting.

"For now, the Fed is not providing forward guidance, but that didn't matter as the FOMC's dot plot delivered a clear message, and it was much more hawkish than expected. Chair Warsh did not submit a dot, and with an even number of participants the median for this year fell between no change and one hike. Next year's dots were also generally above expectations, with the median unchanged from the current rate setting. The decision to leave rates unchanged was reached by a unanimous 12-0 vote. The post-meeting statement was trimmed down significantly, eliminating a lot of boilerplate language that seemed unnecessary to begin with.

"The forward guidance was dropped entirely, with the only thing close being a reference that: "The Committee will deliver price stability." Given the terse statement that focused on getting inflation back down, one might wonder why the Committee didn't hike," JPM addds.

Yen bears are finding support from global inflation dynamics, and they may expect Japanese policymakers may be more tolerant of currency weakness as a result.

USD/JPY’s break to two fresh year-to-date highs following central bank meetings this week signals renewed upside potential after a long stretch of consolidation, during which implied volatility and the average true range fell to the lowest level since 2022. The pair is underpinned by rising short-term Treasury yields after unexpectedly hawkish comments about inflation from Fed Chair Kevin Warsh, alongside similar concerns voiced by the Bank of England, even as oil slides to a three-month low and shares advance. DXY pushing to a one-year high above its upper Bollinger on short-covering adds to the bullish bias.

Despite the move, Japanese officials have offered only limited verbal resistance. Chief Cabinet Secretary Minoru Kihara said authorities can act “at any time,” while noting a weaker yen supports corporate profits but raises costs for firms and households. While MOF officials may comment on FX before the weekend, the subdued tone from Kihara suggests intervention may not be imminent, even as yen shorts stretch, with dollar strength driven by Fed policy divergence.

Option convexity points to a choppy but still upward-biased move, with scope to test the 2024 high of 161.96 even as yen shorts employee options to hedge. The key concern for officials may be the psychological normalization of the 160 level, which could open the door to a deeper move toward the November 1986 high near 165 as it retraces a multi-decade decline. A close below 160 would help change this developing mindset.
Yen OI


Yen Monthly


Yen


(Robert Fullem is a Reuters market analyst. The views expressed are his own.)

MUFG Research reviews today's June BoE meeting.

"Macro view: The BoE left rates unchanged at 3.75%, as expected, with a 7-2 vote split and no change to the core guidance. The tone of the statement and messaging reinforced a clear ‘wait and see’ stance. Since the last meeting, softer UK data and the retracement in energy pricing after the US-Iran deal have reduced the urgency for action. The majority of officials are still comfortable that tighter financial conditions will sufficiently counter energy-driven inflation risks. It now seems that the hawks have lost the argument for a proactive, ECB-style hike and we ultimately believe that second-round risks will remain contained given the extent of UK labour market slack. We are therefore dropping our call for tightening this year with the BoE set for a prolonged hold before resuming gradual easing in 2027," MUFG notes.

"Markets view: UK yields and the GBP have continued to correct lower after today’s MPC meeting. The recent US-Iran deal and softer UK economic data have helped to ease pressure on the BoE to raise rates in response to the energy price shock. The BoE indicated today that they were not in a hurry to tighten policy and wanted time to assess the fallout for the UK economy. We have dropped our own forecast for two BoE hikes this year. It leaves room for the UK yields and the GBP to continuing moving lower as BoE rate hike expectations are scaled back especially against the USD after the Fed opened the door for hikes overnight. UK political uncertainty could add to downside risks for the GBP and gilts after today’s Makerfield by-election," MUFG adds.

Bank of America Global Research summarizes the key notes from its latest meetings with US investors.

"US investors appear almost uniformly bearish on Europe. They see limited progress on structural reforms, are underwhelmed by the impact of Germany's fiscal stimulus so far, and view Europe as highly exposed to energy disruptions and competition from China. They see scope for the Fed to be repriced higher, but view ECB hikes as either "risk management" or a potential "policy mistake". In FX, bearishness on EUR is similar to what we observed in February 2025, although positioning appears to lag," BofA notes.

"We also expect relative data to continue weighing on EURUSD over the summer and see scope for further Fed repricing. Over the medium term, however, we maintain a bullish EURUSD bias. A viable Iran peace deal would reduce uncertainty and lower energy prices. This summer could mark the peak of US-Euro area growth divergence, in line with our economists' base case. We also see a low bar for positive surprises around European reforms and German fiscal policy. That said, we share concerns around next year's European elections," BofA adds. 

(Repeats with no changes)

June 18 (Reuters) -

• FX options expire at 10-am New York/1400 GMT on Thursday 18 June

• EUR/USD: 1.1400-05 (1.1BLN), 1.1415-25 (775M), 1.1450 (2.74BLN)

• 1.1465-70 (518M), 1.1475-80 (792M), 1.1490-95 (483M), 1.1500-10 (14.7BLN)

• 1.1515-20 (575M), 1.1525-35 (1.2BLN), 1.1540-50 (3.73BLN)

• 1.1555-65 (805M), 1.1570-80 (2.3BLN), 1.1585-95 (1.2BLN), 1.1600-10 (3.3BLN)

• 1.1615-25 (2.3BLN), 1.1630-40 (6.04BLN), 1.1645-55 (5.4BLN)

• 1.1660-75 (1.92BLN), 1.1700 (1.7BLN)(Peter Stoneham is a Reuters market analyst. The views expressed are his own)

• GBP unable to find support despite firmer-than-expected jobs data

• Policy-relevant metric softer; private sector wages at 2.9% vs BoE Q2 3% f/c

• Undershoot reinforces downside risks to GBP via softer domestic inflation impulse

• Macro driver remains external as the hawkish Fed meeting dictates near-term price action

• Event risk ahead with the BoE decision and Makerfield by-election in focus

• EUR/GBP retains topside bias after holding key support at 0.8600-20

• Resistance seens at 0.8681 (May 29 high) and 0.8700 (200DMA)
eurgbp daily chart


private sector wage growth


Justin McQueen is a Reuters market analyst. (The views expressed are his own). ((Email: ))

(Repeat with addition of Thursday's EUR/USD expiries)

June 18 (Reuters) - Foreign exchange option expiries for the New York cut at 10.00 a.m New York (1500 GMT) can, under certain conditions have an impact on currency spot prices.

For Thursday's EUR/USD expiries there is a massive 1.1500 strike worth over EUR 14 billion. This deal is likely to impact the spot price.

Gamma hedging is a major driver when traders who are short of options often hedge their exposure in spot. As spot moves closer to key strikes near the expiry time, hedging flows can increase and become one-sided (buying if market is below a big strike, selling if above), which can influence spot.

Market conditions that can heavily influence the impact of option expiries include the following. The notional size of the expiry if large relative to typical market liquidity in that pair and the time of day. Strikes that are near the current spot (at or very near-the-money into the cut), especially if there are several clustered strikes. If dealer positioning is skewed (the street is generally short gamma), so many players need to hedge in the same direction and if liquidity is thinner (e.g., around data, holidays, or in less-liquid currency crosses), so hedging flows have a greater impact.

Spot traders will look for patterns that can appear ahead of option expiries.

Magnet effect: If there's a large expiry, at or very near spot, the price sometimes gravitates toward that strike into the cut as hedgers adjust.

Volatility spike / mean reversion: Short-gamma hedgers may buy high and sell low as spot moves, which can add noise and short-term volatility. Long-gamma players can have the opposite, dampening effect.

Fade after the cut: Once the options expire and hedging flows stop, the market can "relax", and any artificial pressure around a strike may fade.

Option expiries, if strikes are large can impact spot but not always, and usually only when certain conditions are met.

EUR/USD option expiries for Thursday, June 18
EUR/USD Option expiries for June 18


(Peter Stoneham is a Reuters market analyst. The views expressed are his own)

• Yen could be on the brink, despite the BOJ's rate hike and official concerns about a weak yen

• USD/JPY briefly surged to 160.79 on Wednesday, a nearly two-year high

• That rise has wiped out USD/JPY losses caused by Japan's April 30 intervention

• Japan vows to act 'any time' on yen as markets brace for intervention

• Spot has traded in a tight 160.54–160.76 EBS range, the key level to watch is 161.00

• A break above 161.00 would intensify pressure on Japanese officials to act

• A continued lack of action from authorities could encourage further yen selling across markets

• 30-day log correlation between USD/JPY, EUR/JPY well below +0.5 (relationship broken)

Daily Chart


Correlation Chart


(Martin Miller is a Reuters market analyst. The views expressed are his own)

• AUD/USD meets headwind pre-0.70425 (Tuesday low) after rising from 0.6995

• 0.6995 was Wednesday low, after USD jumped on Fed's hawkish hold

• Wednesday high was 0.70755, pre-Fed (0.7079 was Tuesday high)

• 0.6995 is the lowest level since last week's two-month low of 0.6979 (June 11)

• U.S. and Iran presidents sign ceasefire agreement

• Citigroup pushes back Fed rate-cut timeline amid rising hawkishness

AUDUSD


(Robert Howard is a Reuters market analyst. The views expressed are his own)

• Cable slid to 1.3264 as dollar jumped on Fed's hawkish hold Wednesday

• 1.33845 was pre-Fed low. 1.3325 (June 11 low) is now a resistance level

• U.S. and Iran presidents sign ceasefire agreement

• UK jobless rate 4.9% vs 5.0% forecast; wages up 3.4% vs 3.2% forecast

• BoE is set to keep its policy rate at 3.75% at 1100 GMT; 7-2 MPC vote likely

• Voters cast ballots in Makerfield poll crucial to UK PM Starmer's future

GBPUSD


(Robert Howard is a Reuters market analyst. The views expressed are his own)

• FX options expire at 10-am New York/1400 GMT on Thursday 18 June

• EUR/USD: 1.1400-05 (1.1BLN), 1.1415-25 (775M), 1.1450 (2.74BLN)

• 1.1465-70 (518M), 1.1475-80 (792M), 1.1490-95 (483M), 1.1500-10 (14.7BLN)

• 1.1515-20 (575M), 1.1525-35 (1.2BLN), 1.1540-50 (3.73BLN)

• 1.1555-65 (805M), 1.1570-80 (2.3BLN), 1.1585-95 (1.2BLN), 1.1600-10 (3.3BLN)

• 1.1615-25 (2.3BLN), 1.1630-40 (6.04BLN), 1.1645-55 (5.4BLN)

• 1.1660-75 (1.92BLN), 1.1700 (1.7BLN)(Peter Stoneham is a Reuters market analyst. The views expressed are his own)