US Dollar Price Forecast: FOMC Minutes Eyed as Traders Reprice Fed Cuts – GBP/USD and EUR/USD

Market Overview

During the Asian session on Wednesday, the U.S. Dollar Index (DXY) inched closer to 97.70 as traders positioned themselves ahead of the release of the Federal Open Market Committee (FOMC) minutes. Investors are closely watching for guidance on interest rate policy amid renewed concerns about inflation.

Trump’s Trade Proposals Stoke Inflation Fears

The dollar’s recent strength followed remarks by President Donald Trump, who proposed a 50% tariff on copper imports and hinted at a 200% duty on pharmaceuticals. These potential measures have raised concerns about higher input costs across key sectors, thereby reinforcing inflation expectations.

In response, traders have scaled back expectations for rate cuts. Markets previously anticipated 50 basis points of easing by year-end, starting in October.

However, the risk of prolonged inflation may prompt the Fed to hold rates steady into 2025, which could support the dollar in the near term.

Fed Guidance Remains in Focus

All attention now shifts to the FOMC minutes due later today. Any indication that policymakers are reassessing the timeline for rate cuts could influence market positioning.

Additionally, upcoming speeches by Fed officials may offer further insight. A hawkish tone would likely reinforce current dollar resilience, while dovish remarks could reopen the door to policy easing later this year.

US Dollar Index (DXY) – Technical Analysis

The U.S. Dollar Index is trading at $97.58, holding within a rising channel that has defined the short-term uptrend since early July. The price remains above the 50-EMA ($97.17), while the 200-EMA at $97.65 acts as immediate resistance.

A rejection near the channel’s upper boundary and the 200-EMA suggests potential consolidation or pullback toward the $97.17 or $96.88 support zones. Price action continues to print higher lows, preserving a bullish structure.

A sustained breakout above $97.85 could target $98.19 and $98.47. However, failure to hold above $97.48 may invite short-term profit-taking. Bulls remain in control unless the price closes below the ascending trendline or 50-EMA.

GBP/USD Technical Analysis

GBP/USD is trading near $1.3590 after breaking down from a symmetrical triangle on the 2-hour chart. Price has moved below the 50-EMA ($1.3620) and 200-EMA ($1.3611), both of which now act as resistance. The breakdown area around $1.3597–$1.3610 has formed a supply zone, where price is currently struggling to reclaim lost ground. Support lies at $1.3541 and $1.3501.

The candlestick structure indicates indecision below this zone, suggesting that the bearish bias remains intact unless the bulls push back above $1.3645. A sustained move below $1.3541 could target $1.3501 and $1.3470.

The confluence of moving averages and former support-turned-resistance suggests that any upward attempt may be short-lived without a confirmed breakout.

EUR/USD Technical Forecast

EUR/USD is trading near $1.1718, consolidating within a descending triangle pattern on the 2-hour chart. The price remains capped below the 50-EMA ($1.1739), which continues to exert downward pressure. The pair has established a series of lower highs while holding above horizontal support near $1.1681, reflecting tightening range behavior.

A breakdown below $1.1681 could accelerate losses toward $1.1640 or $1.1591. Conversely, a breakout above $1.1765 would invalidate the bearish structure and create room for a move toward $1.1791 and $1.1830. The 200-EMA at $1.1667 adds an extra layer of support beneath current levels.

With both EMAs sloping flat to down, bearish momentum dominates unless bulls reclaim territory above the descending trendline.