Daily Forex Highlights – Jun 25 – US crude stocks at 40-year lows; yen nears 4-decade high; BOJ hawkish signals

📌 What Moves Markets Today

US crude inventories fell for the ninth straight week to their lowest since October 1984. The SPR hit its lowest since June 1983. USD/JPY is approaching 162.00, a 40-year high, as the BOJ's dovish stance keeps the yen under pressure. BOJ board member Tamura called for moving rates toward neutral to avoid forced hikes later. Markets are eyeing US PCE data for the next catalyst.

🔴 Bearish for oil as supply tightens but demand uncertainty remains.

🔴 Yen remains under pressure as rate differentials widen.

🟡 Neutral for USD ahead of PCE data.

🔥 Quick Takes

Dollar

- Treasury Secretary Bessent: Reiterated dollar dominance, praised Warsh for removing forward guidance → A strong dollar policy signal. The Fed is keeping its options open.

- US Q1 current account deficit widened: Goods trade deficit narrowed but primary income turned to deficit → A mixed picture. The overall imbalance is growing.

- US crude inventories fell for the 9th straight week to the lowest since October 1984. SPR stocks hit their lowest since June 1983. → Supply is tightening sharply. A bullish signal for oil.

- Wall Street banks passed Fed stress tests, clearing the way for billions in dividends → Banks are healthy. No systemic risks.

- Trump: "We need low interest rates." → Political pressure on the Fed. Markets are watching for any Fed response.

Euro

- ECB: War-driven oil price increases will reduce euro zone GDP growth by about 0.4 percentage points in the first year. ECB rates are not yet restrictive. → The ECB sees room to hike. A hawkish signal.

- Germany July consumer confidence remains low but shows signs of stabilization → A slight improvement. The worst may be passing.

Pound

- Markets are no longer fully pricing a 25bp BOE rate hike this year → Dovish repricing. Sterling may remain under pressure.

Yen

- Japan weekly flows (to June 19): Bought foreign bonds +1,997B yen; foreign stocks +4,268B yen; foreign investors bought Japanese stocks +4,794B yen; sold Japanese bonds -10,573B yen → Japanese investors are buying overseas assets. Foreign investors are buying Japanese stocks but selling bonds.

- BOJ board member Tamura: Important to move policy rates toward neutral to avoid forced large hikes later. If upside inflation risks appear, may need to accelerate hikes. → A hawkish voice. The BOJ is considering gradual tightening.

- Japan 20-year bond auction bid-to-cover ratio fell to 2.97, lowest since May 2025 (previous 4.01) → Weaker demand at the auction. A sign that bond markets are nervous.

- Yen at historic lows could generate $5.8 billion in gains for Japanese automakers → A weaker yen boosts exporters' profits. A tailwind for auto stocks.

Other

- Australia May unemployment rate: 4.4% (in line with 4.4% expected, down from 4.5% previously) → Jobs market remains strong. The RBA may need to stay tight.

- Malaysia economy minister: Government will continue targeted, data-driven measures to protect workers and support businesses → A supportive policy stance.

- Thailand commerce ministry: May customs-cleared trade deficit $5.71B (forecast $6.12B); exports expected to continue growing later this year → Better than expected. A positive signal for the baht.

💡 Technical Analysis

Source: Investing.com – Prices as of Jun 25, 2026

EUR/USD – 1.1350

The pair is defending the 1.1350 level, with markets eyeing US PCE data for direction. The dollar rally has paused temporarily, helping the pair hold above support. On the daily chart, price remains below the 20-day Bollinger SMA and well under the 100-day MA, keeping the broader bias firmly bearish. RSI at 28.3 is in oversold territory, suggesting downside is stretched but not yet signaling a firm rebound. Support is at 1.1350 (lower Bollinger Band). Resistance is at 1.1411 (March 13 low), 1.1530 (20-day Bollinger middle band), and 1.1650 (100-day MA).

USD/JPY – 161.95

The pair is approaching 162.00, a 40-year high. The BOJ's dovish stance and wide rate differentials continue to weigh on the yen, offsetting verbal intervention threats. The uptrend remains intact. Resistance is at 162.00 (psychological, multi-decade high). A break above would open the door to further gains. Support is seen at 160.60-160.50 and 158.72.

🔮 What to Watch This Week

- 🇺🇸 US PCE inflation data – key for Fed expectations

- 🇯🇵 BOJ – will Tamura's hawkish views gain traction?

- 🇺🇸 Fed stress tests – bank dividend impact

- 🇦🇺 Australia jobs data – RBA reaction

- 🇹🇭 Thailand trade data – export growth sustainability