USD Weakens Amid Lower Volatility Ahead of Powell’s Speech at Sintra

USD Weakens Amid Lower Volatility Ahead of Powell’s Speech at Sintra

The US Dollar (USD) holds a weaker stance in the market as overall volatility across equities and debt instruments declines sharply. Despite this, forex volatility remains elevated, particularly for EUR/USD and USD/JPY pairs, which are expected to experience volatility levels exceeding 8% and 10% respectively over the coming months.

This discrepancy reflects market anticipation of possible disruptions from tariffs potentially returning in July, coinciding with investors’ focus on Federal Reserve Chair Jerome Powell’s upcoming remarks at the ECB’s Sintra Forum on Central Banking.

Key Highlights:

• Traded volatility for equities and debt has fallen more steeply than in FX markets.
• Elevated volatility in EUR/USD and USD/JPY underscores the expectation that FX will be the most volatile asset class amid ongoing trade uncertainties.
• Market watchers await Powell’s speech for fresh guidance on Fed policy and interest rate outlook.

Related Reads on Tredu.com:

• Forex Volatility: What to Expect This Summer
• Fed Rate Outlook and Impact on the US Dollar
• Trade Tariffs and FX Market Reactions