EUR/USD, USD/JPY Range-Bound Ahead of Key US CPI and Fed Warsh

Major forex pairs are expected to trade in tight ranges during the European session with no scheduled data releases, as markets await the critical US CPI report and Fed Chair Warsh's testimony later in the American session. EUR/USD and GBP/USD are consolidating near current levels, with traders reluctant to establish significant positions ahead of the inflation data. The CPI release is the day's marquee event and will heavily influence Federal Reserve rate expectations, directly impacting USD crosses. Fed Chair Warsh's testimony adds another layer of event risk, as any hawkish or dovish commentary could amplify the CPI-driven move. Additionally, ongoing US-Iran geopolitical tensions remain a wildcard that could trigger sudden volatility and safe-haven flows into JPY and CHF at any moment. Traders should be prepared for rangebound conditions in European hours followed by potentially explosive moves during the US session. Key pairs to monitor include EUR/USD, USD/JPY, and gold-correlated pairs. Risk management is paramount given the convergence of multiple high-impact catalysts within a compressed timeframe.