US Dollar Price Forecast: DXY Near 99.38 as Fed Minutes and UK Inflation Loom; EUR/USD and GBP/USD Hold Firm

Market impact: mixed, with a slight near-term bearish bias for the dollar and constructive risk for EUR/USD.

The key market issue is not the technical level itself, but whether the Federal Reserve minutes reinforce or challenge the current expectation of a September hold. A less hawkish record would likely pressure U.S. yields and reduce the dollar’s rate advantage, supporting EUR/USD and GBP/USD. Conversely, evidence of meaningful concern about renewed inflation—particularly amid Middle East energy-supply risks—could revive expectations for tighter Fed policy and trigger a sharp dollar rebound.

DXY’s position below the cited 50- and 100-day EMA region indicates that dollar rallies remain vulnerable unless the index regains that resistance cluster. A sustained break beneath the reported 99.38 support would strengthen the bearish technical narrative and could amplify upside momentum in EUR/USD through momentum and stop-loss flows. However, support tests before a major event often produce false breaks, so confirmation from Treasury yields and Fed-rate pricing is more important than the level alone.

For EUR/USD, the fundamental backdrop is comparatively supportive because markets are pricing a more hawkish ECB relative to a potentially stationary Fed. That policy-divergence trade favors the euro, while the pair’s position above its cited rising trendline and moving averages leaves the immediate bias positive. The main risk is that euro-area inflation is described as heavily energy-driven; if energy prices stabilize or the ECB signals that such inflation is temporary, current tightening expectations could unwind and limit euro gains.

Sterling faces a more asymmetric event risk. A hotter-than-expected UK inflation reading could lift gilt yields and temporarily support GBP/USD by reducing expectations for BoE easing. But persistent inflation alongside cooling labor-market conditions would worsen the policy trade-off: the BoE could be constrained from easing without improving the growth outlook. A softer inflation result would therefore be more clearly negative for sterling, especially if it coincides with hawkish Fed minutes.

Trading interpretation:

the immediate bias favors dollar weakness, but the event risk is two-sided and likely to be driven by rates rather than spot-chart structure. Traders should monitor the Fed minutes’ discussion of inflation and dissent, U.S. Treasury yields, September Fed pricing, UK headline and services inflation, ECB communication, and whether EUR/USD can hold the article’s cited 1.1545–1.1570 support zone. A failure of DXY support without confirmation from lower U.S. yields would be less reliable; a hawkish repricing could quickly invalidate the bearish-dollar view.