FX Tactician: USD: From range to rally

Research evidence excerpt

FX Tactician: USD: From range to rally

19 June 2026

Currencies

Global FX Tactician

USD: From range to rally

◆ The shifting Fed narrative is a bullish game-changer for the

USD, facilitating a break-out from long-running ranges

◆ Some of G10 FX may weather the USD rally better than

others (eg. AUD, NZD, SEK and JPY)

◆ We look for USD gains versus EUR and GBP. Lower oil

prices leave NOK and CAD additionally exposed

In last month’s FX Tactician, we described how the geopolitical stalemate in the Daragh Maher

Head of Digital Assets Research, Sr FX Strategist

Middle East was being echoed in a currency blockade. With the exception of a HSBC Bank plc

bearish view on GBP and CAD, we expected most of G10 FX to remain range bound. daragh.maher@hsbc.com +44 20 7991 8888

One month later, and that blockade has been broken by two developments, namely

Paul Mackel

the US-Iran interim peace deal and a materially hawkish policy reframing at the Fed. Global Head of FX Research

The Hongkong and Shanghai Banking Corporation Limited

The latter element, in particular, has spurred the USD higher through key levels paulmackel@hsbc.com

against many currencies, and prompted us to revise our medium-term forecasts to +852 2288 5523

anticipate further USD strength ahead (see FX forecast update, 18 June 2026). Nick Andrews

Senior FX Strategist

This USD bullish picture is also likely to play out further in the near term. While HSBC Bank plc

nick.andrews@hsbc.com

reduced geopolitical risk is a headwind to the USD, we expect the hawkish +44 207 9912376

momentum in US rate expectations will become the dominant driver of the USD and Tom Wookey

see the currency rally further. In addition, Fed policy is being driven by US economic European FX Strategist

HSBC Bank plc