• Will USDJPY find its next bullish catalyst this week to resume its uptrend?

• EURUSD stays victim to the dollar; needs significant gains to violate downtrend

• GBPUSD supported, but not bullish yet; focus on 1.2700 region

FOMC meeting minutes, S&P Global business PMIs –> USDJPY

In response to upbeat US data, investors have almost convinced themselves that the Fed will not deliver its first rate cut in spring while they are also undecided whether June’s policy meeting will be the right time to shift to the dovish side.

On Wednesday, the FOMC meeting minutes will be closely watched for any missed information about the timing of rate cuts, while Thursday’s S&P Global business PMI readings will be the first piece of data for February (14:45 GMT) and might attract special attention as forecasts point to a moderate decline.

If the headlines back the Fed’s wait-and-see mode, USDJPY could extend last week’s pullback from a three-month high of 150.87. The decelerating technical indicators are currently endorsing that scenario, though unless selling pressures strengthen below the 148.55 key constraining zone, any declines could still motivate traders to buy the dip.

Eurozone S&P Global business PMIs –> EURUSD

The Eurozone will also see the release of February’s S&P Global business PMIs earlier on Thursday at 09:00 GMT. The figures could bring some good news to the euro as analysts estimate a second consecutive monthly increase, though whether that will be enough to break EURUSD’s 2024 downtrend above the key resistance of 1.0880 and the 50-day simple moving average (SMA) remains to be seen.

Investors believed that the ECB would be the first to cut its borrowing costs amid the bloc’s gloomy economic performance, especially in the business sector. However, the central bank remained committed to its inflation goal, defying projections for any rate reductions before summer. While this should have been a positive factor for the euro, a similar stance by the Fed wiped out EURUSD’s gains, putting the pair back into a downtrend.

UK S&P Global business PMIs –> GBPUSD

The British pound has been more resilient to the dollar’s strength than its euro counterpart, recently pivoting higher near an important support trendline. Although the UK economy entered a mild technical recession in the last quarter of 2023, consumer prices continued to grow faster than in other economies, raising questions about whether a rate cut will ever happen this year.

A second monthly improvement in the S&P Global manufacturing and services PMI figures on Thursday (09:30 GMT) could send rate cut expectations further out on the horizon, helping GBP/USD to build on last week’s rebound. From a technical perspective, the pair will have to rally decisively above the 1.2700-1.2770 region to shift the outlook back to bullish.