UNITED STATES, AND USD
Robust Labour and Hawkish Hold Anchor the Greenback Amid Volatility
USD has a fundamental strength score of +2 on a scale of -10 to +10 over the coming 7 weeks, with a conviction rating of 3 on a scale of 0 to 10.
Watch the Non-Farm Payrolls on July 2, 2026 where expectations of a resilient labor market will be tested, and subsequently have an influence on the Fed’s policy trajectory.
Robust Labour and Hawkish Hold Anchor the Greenback Amid Volatility.
Moderately Bullish but Not Without Risks
The fundamentals draw its main support from the steady run of solid US data and the Federal Reserve’s hawkish lean.
The past weeks have produced some robust numbers. Headline inflation climbed to a three-year high of 4.2 percent, and payrolls jumped 172,000. That combination led the Fed, now led by Chairman Kevin Warsh, to flag upcoming rate hikes. It’s puts real wind behind the dollar’s sails.
What keeps the score from climbing higher is the intermarkets. Safe-haven flows have been fading. The VIX has dropped more than 9 percent and gold has fallen over 8 percent in the last month. Those moves point to a cooling geopolitical risk premium after the temporary US-Iran agreement.
Q1 GDP also printed softer at 1.6 percent, underlining some mild domestic weakness.
Conviction stays capped at 3 because the next seven weeks are packed with major data drops. July’s Non-Farm Payrolls, the CPI report, and the July FOMC decision sit right ahead. One or two surprises could easily move the needle.
What We’ve Seen Lately
On June 5, 2026, the Bureau of Labor Statistics dropped the May jobs report, and it was a strong one. Non-Farm Payrolls surged 172,000 against a forecast of 85,000. Together with the 4.2 percent inflation print earlier that week, it killed off near-term rate-cut hopes and underscored the dollar’s structural resilience.
Then on June 17, 2026, the FOMC left the federal funds rate unchanged at 3.50 to 3.75 percent. The decision carried a clear hawkish tone: nine of the nineteen officials now expect a hike by year-end. With Kevin Warsh at the helm, the committee also stripped out forward guidance. The dollar index hit a new 2026 high and short-term Treasury yields rose sharply.
What’s Next on the Calendar
Near term, eyes are on the May PCE and Core PCE releases due June 25, 2026. These are the Fed’s favored inflation gauges, so they’ll give a fresh read on whether price pressures are staying sticky. That will feed directly into rate bets and short-term dollar swings.
The bigger event in the next seven weeks is the FOMC meeting on July 29, 2026 — only Warsh’s second in charge. It will show whether the hawkish line holds and if officials start setting up for a possible September rate increase. The outcome could shape capital flows and dollar direction for the rest of the year.
Gavin Pearson has been studying the currency markets as a retail trader for twenty years.
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The technical analysis here is sound. But there's a structural irony running through every bullish catalyst you've identified that's worth naming.
The Hormuz blockade drives oil above $110. That drives inflation. That drives yields higher. Higher Treasury yields mean higher interest payments on U.S. government bonds.
Now ask: who benefits from those interest payments?
USD1 - the private stablecoin issued by World Liberty Financial, in which Trump, his sons, and his chief diplomatic negotiator Steve Witkoff hold direct financial stakes - backs its reserves with U.S. Treasury bonds. The interest on those bonds, paid by American taxpayers, flows 75% into Trump and Witkoff family accounts. Every basis point of yield increase you're trading as a bullish dollar signal is simultaneously increasing the private seigniorage flowing to the family running the geopolitical crisis that generated it.
And Witkoff - the man negotiating America's position in the Middle East, the exact region where the Hormuz blockade is happening — is a direct financial beneficiary of the energy shock driving your thesis.
The safe-haven premium is real. The yield advantage is real. Your trade setup may well be correct.
But the dollar you're trading bullish is being quietly hollowed out from the inside. The question isn't whether the dollar strengthens in the next few weeks. It's whether the institution behind it still exists in the form you're pricing in.