Fundamental Market Analysis for July 24, 2026 (EURUSD, GBPUSD, USDJPY)
EURUSD:
The euro enters the European session near 1.1380 after the ECB decided to leave its key interest rates unchanged. The central bank reiterated that future decisions would depend on incoming data but gave the market no clear indication of an imminent policy tightening. This provides only limited support for the single currency, especially amid uneven business activity and renewed risks to energy costs.
The main driver of the current session is a stronger US dollar. The yield on the 10-year US Treasury note has risen above 4.7%, while initial jobless claims declined to 187,000. At the same time, higher oil prices and tighter trade restrictions are adding to inflation risks, encouraging the market to maintain expectations of a more restrictive Federal Reserve stance.
Short-term interest rate expectations continue to favor the US currency. The ECB’s pause has failed to strengthen demand for the euro, while the resilient US labor market and elevated Treasury yields support the dollar. If geopolitical tensions and inflation concerns persist, EURUSD may remain under pressure. Under the baseline scenario, further downside remains the priority.
Trading idea: SELL 1.1380, SL 1.1410, TP 1.1310
GBPUSD:
The pound begins the session without a strong domestic catalyst after UK inflation slowed. The Consumer Price Index rose by 2.6% year-on-year in June, compared with 2.8% in the previous month. These figures do not rule out further action by the Bank of England, but they reduce the urgency of significant policy tightening and limit the pound’s ability to withstand a stronger dollar.
The US currency is supported by a combination of elevated Treasury yields and resilient labor market data. The decline in initial jobless claims to 187,000 reinforced confidence in the US economy, while oil prices above $100 increased concerns about renewed inflationary pressure. This environment raises the dollar’s appeal and restrains demand for currencies that are more sensitive to external risks.
The UK’s domestic backdrop also remains a constraint for GBPUSD. Softer inflation is accompanied by fiscal risks and high borrowing costs, meaning that expectations for the Bank of England do not currently provide a sufficient advantage over the Federal Reserve. If demand for the dollar and cautious risk sentiment persist, the baseline scenario allows for a further decline in the pair.
Trading idea: SELL 1.3310, SL 1.3345, TP 1.3225
USDJPY:
USDJPY is holding near 163.80 after the yen weakened to an almost 40-year low, although the fundamental case for further gains has become less one-sided. Japan’s finance minister stated that the authorities were prepared to take decisive action in the foreign exchange market, while the US Treasury highlighted the undesirability of excessive volatility and the need for further steps from the Bank of Japan.
Support for the dollar remains substantial. The yield on the 10-year US Treasury note is above 4.7%, Federal Reserve expectations have become more restrictive, and oil prices above $100 are increasing inflation and import-related risks for Japan. The interest rate differential continues to weigh on the yen, meaning that verbal warnings alone may not be enough to produce a sustained recovery.
However, the current session is marked by a fresh official signal and the exchange rate’s proximity to levels at which the likelihood of practical action by the Japanese authorities rises considerably. The dollar’s additional upside is limited by the risk of a sharp reduction in interest rate differential trades, while any response to intervention could be swift. The local Japanese factor may therefore outweigh the broader dollar impulse, and the baseline scenario allows for a decline in USDJPY.
Trading idea: SELL 163.80, SL 164.15, TP 162.95
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