Monex’s October 2025 FX Forecasts

As we noted in last month’s forecasts, risks appeared firmly skewed toward a more dovish Fed, and consequently, a weaker dollar than we had expected. Indeed, our view at the beginning of September noted that the evolution of data would be key – and broadly speaking, the major data indicators missed to the downside, leading us to update our US labour market view and to pull forward our expectations for US rates, looking for the Fed to restart its easing cycle at the September policy meeting. The FOMC duly delivered, a move that we think marks the start of a succession of rate cuts. Even so, it was surprising to see the dollar rally post-meeting, a dynamic that has helped the buck to finish the month flat.

Given this, most dollar pairs closed out September in line with our last set of one-month forecasts, even as we remain sceptical around the rationale put forward by both rate setters and markets. In any case, we think September’s events entail a change in sequencing relative to our prior expectations, rather than requiring a fundamental overhaul of our base case. As such, we are leaving our longer-run projections unchanged for October, even as we make some small short-term tweaks. This sees us continuing to call for renewed dollar downside looking ahead, bringing to an end the greenback stabilisation seen over the summer period.

Read our October 2025 FX Forecasts here:

DOWNLOAD THE FULL REPORT

Authors: 

Nick Rees, Head of Macro Research

Barry van der Laan, Senior FX Market Strategist

Disclaimer

This information has been prepared by Monex International Markets plc, part of Monex S.A.P.I. de C.V. (“Monex”). The material is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is, or should be considered to be, financial, investment or other advice on which reliance should be placed. No representation or warranty is given as to the accuracy or completeness of this information. All entities in the “Monex” group of companies are regulated for different products and services within the jurisdictions in which they operate. Details of the different entities can be found here. Details of the respective entities’ regulated status and available products and services can then be found on the relevant links to the individual jurisdictions’ website.