USD/HKD Outlook:
Slightly positive, but likely to move sideways due to the USD trading above its 90-day average and near recent highs.
Key drivers:
• Rate gap: The Federal Reserve's pause on interest rate cuts may support the USD against the HKD.
• Risk/commodities: Global oil prices remain above average, likely providing a supportive backdrop for the US economy, impacting the USD positively.
• One macro factor: Strong US job growth signals are reinforcing expectations for a robust labor market, which could lend strength to the USD.
Range:
The USD/HKD rate is expected to hold within its recent range, possibly drifting as conditions evolve.
What could change it:
• Upside risk: A surprise increase in US interest rates could push the USD higher against the HKD.
• Downside risk: Renewed geopolitical tensions affecting US trade could negatively impact the USD's value.