UOB’s Quek Ser Leang and Lee Sue Ann note a sharp opening rise in GBP/USD, with rapid upward momentum that could see the pair test 1.3505, while 1.3530 remains a key resistance.

The Euro (EUR) trades 0.15% higher to near 185.00 against the Japanese Yen (JPY) during the European trading session on Monday.

The Swiss Franc (CHF) accelerates its recovery against the US Dollar (USD) on Monday, with the USD/CHF pair reaching 11-day lows below 0.7820 at the moment of trading, down from highs past 0.7900 last week.

Brown Brothers Harriman’s (BBH) Elias Haddad expects the European Central Bank's (ECB) April Account to underline a tightening bias, with markets already pricing high odds of a June rate hike to 2.25%.

Dow Jones futures advance 0.82% to near 50,100 during European hours on Monday. Meanwhile, the S&P 500 rise 0.93% above 7,550, and the Nasdaq 100 futures gain 1.38% above 29,950. Trading activity is expected to stay subdued as US regular markets will be closed due to the Memorial Day bank holiday.

Here is what you need to know on Monday, May 25:

HSBC analysts argue that foreign exchange intervention alone is unlikely to keep the USD/JPY pair sustainably below 160. They stress that effectiveness increases when intervention coincides with Bank of Japan (BoJ) rate hikes and lower Oil prices.

Commerzbank analysts highlight that USD/INR fell 0.5% to 95.71 and is down 0.3% on the week, as the Reserve Bank of India (RBI) intervenes in spot markets and tightens gold import rules.

Philip Wee at DBS highlights uncertainty around new Fed Chair Kevin Warsh’s approach, noting President Trump’s preference for lower rates and Warsh’s reform-oriented stance.

The New Zealand Dollar (NZD) maintains a moderately negative tone against the US Dollar (USD) on Monday, despite a somewhat brighter market sentiment.

UOB’s Quek Ser Leang and Lee Sue Ann report that AUD/USD rebounded sharply after recent weakness, with the pair swinging between 0.7100 and 0.7168 and now trading near 0.7155.

AUD/USD holds ground after two days of losses, trading around 0.7170 during the early European hours on Monday. The pair appreciates as the Australian Dollar (AUD) receives support from fading safe-haven demand in anticipation of the United States (US)-Iran accord.

The USD/JPY pair attracts some dip-buyers following a bearish gap opening on Monday and reclaims the 159.00 mark during the early part of the European session.

Brown Brothers Harriman’s (BBH) Elias Haddad expects the RBNZ to hold the Official Cash Rate (OCR) at 2.25% this week, while swaps price 125 bps of tightening over the next year.

Rabobank’s RaboResearch Global Economics & Markets team notes that Brent Oil has fallen 5% again despite ongoing Middle East tensions, underscoring a pattern of repeated price pullbacks.

Pi Network (PI) is consolidating near $0.1500 at press time on Monday, lacking clear momentum as the broader cryptocurrency market anticipates a recovery amid hopes of a US-Iran peace deal. 

MUFG’s Teppei Ino reviews recent USD/JPY performance, noting that the pair opened at 156.86 and rose toward 158.50 as the Dollar strengthened on difficult US-Iran negotiations, higher crude oil prices and renewed inflation concerns.

According to the Iranian Student News Agency (ISNA), a senior Iranian diplomat said that the nuclear issue and highly enriched uranium reserves will be discussed with the United States (US) in 60-day negotiations in exchange for the lifting of sanctions and unfreezing of assets.

The US Dollar (USD) gapped lower at the start of Monday’s session, retreating from the 99.30 area, the lower limit of last week’s trading range, to 99.00.

HSBC analysts discuss why the Canadian Dollar (CAD) has not strengthened significantly despite higher Oil prices, highlighting structural constraints in Canada’s non-US export capacity.

European Central Bank (ECB) policy governing council member and Governor of the Bank of Greece, Yannis Stournaras said during the European trading session on Monday that the closure of the Strait of Hormuz, a critical passage to almost 20% of global energy supply, may have secondary effects on wages

Turkey Economic Confidence Index increased to 97.2 in April from previous 96.4

West Texas Intermediate (WTI), futures on NYMEX, are down 6% to near $90 in the European trading session on Monday, the lowest level seen in over two weeks.

MUFG’s Lloyd Chan notes that higher US 2-year yields and elevated Brent prices are supporting broader USD strength, with markets now fully pricing one Fed rate hike by January 2027.

The EUR/GBP cross trades in negative territory around 0.8635 during the early European trading hours on Monday. Traders await the speeches from the European Central Bank (ECB) policymakers later this week, including President Christine Lagarde, for fresh impetus. 

UOB’s Quek Ser Leang and Lee Sue Ann describe EUR/USD as firming after a brief dip to 1.1575, with upward momentum starting to build.

Silver (XAG/USD) failed to breach resistance at the $79.00 area earlier on Monday, but remains moderately bid, trading in the mid-$77.00s at the time of writing.