The forex market on March 28, 2025, is witnessing significant volatility driven by a mix of economic data releases, geopolitical tensions, and central bank policies. The U.S. dollar is under pressure following concerns about slowing economic growth and potential new tariffs imposed by the U.S. administration. Meanwhile, the euro and British pound are showing strength amid optimistic economic indicators, while the Japanese yen and Swiss franc are benefiting from risk-off sentiment.
This report provides a detailed analysis of the major currency pairs, key events influencing the market, and technical insights to help traders navigate today’s trading landscape.
U.S. Dollar (USD) – Struggles Amid Tariff Concerns
The U.S. dollar is trading lower against most major currencies today as investors remain cautious ahead of the core PCE Price Index data, a key inflation gauge for the Federal Reserve. Market participants are also reacting to reports that President Trump is considering a 25% tariff on imported automobiles, sparking fears of a trade war.
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Impact on USD: The dollar is weakening due to falling U.S. Treasury yields and risk aversion in the equity markets.
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Outlook: If PCE inflation remains strong, it could keep Fed rate cut expectations in check, providing some support for the greenback. However, trade tensions could lead to further declines.
EUR/USD – Euro Rises Amid Weaker Dollar and Improved Economic Outlook
The euro is strengthening against the dollar, driven by improving German economic data and expectations that the European Central Bank (ECB) will remain cautious on rate cuts.
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Current Price: 1.0925 (+0.45%)
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Key Support Levels: 1.0880 / 1.0825
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Key Resistance Levels: 1.0950 / 1.1000
Market Drivers:
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Eurozone Inflation: Preliminary CPI data shows inflation slowing but remaining above the ECB’s 2% target, reducing the likelihood of an early rate cut.
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Risk Sentiment: Positive sentiment in the eurozone, along with dollar weakness, is driving EUR/USD higher.
Technical Outlook:
The pair is testing the 1.0950 resistance level, and a break above this could open the door toward 1.1000. However, if the dollar regains strength post-PCE data, EUR/USD may pull back toward 1.0880 support.
GBP/USD – Pound Gains on Strong UK Retail Sales
The British pound is performing well, supported by stronger-than-expected UK retail sales figures and improved consumer confidence.
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Current Price: 1.2850 (+0.40%)
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Key Support Levels: 1.2780 / 1.2700
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Key Resistance Levels: 1.2900 / 1.2950
Market Drivers:
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Retail Sales: UK retail sales for February increased by 0.6% (expected: 0.3%), boosting confidence in the UK economy.
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BoE Policy Outlook: The Bank of England remains cautious about rate cuts, providing underlying support for the pound.
Technical Outlook:
GBP/USD is approaching 1.2900 resistance, and a breakout could lead to 1.2950. However, profit-taking could push the pair back toward 1.2780 support.
USD/JPY – Yen Strengthens on Safe-Haven Demand
The Japanese yen is appreciating as investors seek safe-haven assets amid renewed trade tensions and global stock market declines.
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Current Price: 149.50 (-0.60%)
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Key Support Levels: 148.80 / 148.00
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Key Resistance Levels: 150.00 / 150.80
Market Drivers:
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Risk Aversion: Rising geopolitical risks and falling equities are driving demand for the yen.
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Bank of Japan Policy: The BoJ is maintaining a cautious stance on monetary tightening, but global uncertainties are pushing USD/JPY lower.
Technical Outlook:
The pair is testing the 149.50 level, and a break below 148.80 could accelerate losses toward 148.00. On the upside, 150.00 remains a key resistance level.
USD/CHF – Swiss Franc Benefits from Risk-Off Sentiment
The Swiss franc is gaining against the dollar as investors move into safe-haven assets amid geopolitical tensions and stock market weakness.
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Current Price: 0.9045 (-0.35%)
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Key Support Levels: 0.9000 / 0.8950
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Key Resistance Levels: 0.9100 / 0.9150
Market Drivers:
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Risk Sentiment: The global risk-off mood is favoring CHF as a safe-haven currency.
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SNB Policy: The Swiss National Bank remains cautious, keeping monetary policy steady.
Technical Outlook:
If USD/CHF breaks below 0.9000, further downside toward 0.8950 is likely. A recovery above 0.9100 could see the pair test 0.9150 resistance.
Emerging Market Currencies – Indian Rupee Rises on Foreign Inflows
The Indian rupee is strengthening as foreign investors continue pouring money into Indian equities.
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Current Price: USD/INR at 82.35 (-0.20%)
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Market Drivers:
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Strong capital inflows into Indian stock markets.
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Declining oil prices, which reduce India’s import costs.
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The rupee could continue appreciating if foreign inflows remain strong, but any global risk-off sentiment could limit gains.
Geopolitical Developments & Market Sentiment
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U.S. Tariffs: President Trump’s proposed 25% tariff on imported cars has sparked concerns of a trade war, weakening the dollar.
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Stock Market Declines: Asian and European markets are trading lower, adding to risk-off sentiment and benefiting safe-haven currencies.
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Gold Prices: Gold has hit a new all-time high as investors seek protection from market uncertainty.
Key Economic Data Releases for Today
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U.S. Core PCE Inflation (February): Expected at 0.3% (YoY: 2.8%) – A higher reading could support the dollar.
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UK Retail Sales (February): Better than expected, boosting GBP.
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Canada GDP (January): Forecasted at 0.1% growth – A miss could weaken CAD.
Forex Market Outlook & Trading Strategies
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For Dollar Bears: If U.S. inflation data disappoints and trade tensions escalate, look for opportunities to sell USD against stronger currencies like EUR, GBP, and JPY.
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For Risk-Averse Traders: Safe-haven plays such as long JPY or CHF positions may provide stability amid market uncertainties.
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For Trend Followers: EUR/USD and GBP/USD remain in uptrends, so buying on dips may be a viable strategy.
Conclusion
Today’s forex market is driven by U.S. economic data, trade war fears, and central bank policies. The U.S. dollar remains under pressure, while the euro and pound are gaining momentum. Risk-off sentiment is benefiting the yen and Swiss franc. Traders should stay cautious ahead of the key PCE inflation release and monitor geopolitical developments for further market direction.
