Weekly Technical Outlook – GOLD, USDJPY, GBPUSD

Fed rate decision → GOLD

Attention this week turns to Wednesday's FOMC decision, with the Fed largely expected to leave rates unchanged at 3.50%-3.75% for a fifth straight meeting. However, oil's surge above $100 a barrel following renewed Middle East tensions has revived inflation concerns, complicating the policy outlook.

Investors will focus on Fed Chair Kevin Warsh's remarks for clues on whether a September rate hike remains under consideration. Although US inflation eased to 3.5% y/y in June, it remains well above the Fed's 2% target, while higher energy prices risk reigniting price pressures.

A hawkish message would likely support Treasury yields and USD, weighing on gold as the opportunity cost of holding the non-yielding metal rises. Technically, the yellow metal has recovered towards 4,100 as US-Iran tensions show signs of easing, but momentum remains subdued and the 50-day SMA continues to cap upside attempts. A hawkish Fed could shift the focus back towards the psychological 4,000 floor, while a softer tone may allow the rebound to extend towards 4,200.

BoJ policy meeting → USDJPY

The Bank of Japan is expected to keep rates unchanged at 1.00% on Friday, following June's 25bp hike to a 31-year high. However, policymakers are likely to maintain a hawkish bias as inflation risks remain elevated amid a weak yen, higher energy costs and robust AI-driven demand.

Investors continue to debate whether the next hike could come as early as September or October, particularly if inflation proves stickier than expected or yen weakness persists. Several BoJ officials have recently argued that rates should move closer to neutral levels, although political pressure from the growth-focused Sanae Takaichi administration may limit the pace of future tightening.

Meanwhile, USDJPY surged to 163.97 last week, marking a fresh 40-year high, before paring gains. Technically, the broader uptrend remains intact, with 164.50 as the next upside target. However, a hawkish BoJ surprise or renewed intervention fears from Tokyo could trigger a correction towards 162.00.

BoE policy meeting → GBPUSD

The Bank of England is widely expected to keep rates unchanged at 3.75%, marking a fifth consecutive hold. Cooling wage growth and easing inflation have reduced the urgency for further tightening. However, policymakers remain wary that renewed Middle East tensions and higher energy prices could reignite price pressures, even after UK inflation eased to 2.6% in June.

Attention will focus on the expected 7-2 vote split, with investors looking for clues on whether policymakers are becoming more concerned about energy-driven inflation risks. Markets will also monitor any discussion around the future pace of quantitative tightening as the BoE reviews its balance-sheet reduction programme.

For GBPUSD, risks remain skewed to the downside. Fiscal uncertainty persists as investors await more details about new PM Andy Burnham's policy plans, while markets continue to price a relatively firm rate outlook despite signs of a cooling economy. Any indication that the BoE is becoming more comfortable with inflation could weigh on sterling, while a more hawkish tone may help sustain the pair's current recovery from the 1.3300 area.