August has turned into an eventful month for forex trading participants. Traders and investors are navigating an ever-changing landscape, driven by factors such as central bank divergence. As of August 2025, major authorities such as the Bank of England (BoE) and the Bank of Japan (BOJ) have taken diverse approaches to interest rates and other policies.

Plus, the Federal Reserve is expected to contribute to the divergence by lowering or, against all odds, increasing rates. The differing strategies create volatility and profitable Forex opportunities. That is why keeping a close watch on the following FX pairs is recommended.

1. EUR/USD

You should monitor EUR/USD closely, because, first, it’s the most traded currency pair. This asset’s position enables it to set the tone for the entire global forex market. Additionally, the pair often reacts strongly to central bank announcements, and, as you’re likely aware, expert analysts and investors expect the Fed to announce rate changes soon. Keep a close eye on EUR/USD and position yourself to capitalize on opportunities immediately when this authority makes the announcement.

2. USD/JPY

The USD/JPY pair is another instrument to watch in August, especially since it is USD-based. The US dollar and Yen are often associated with higher yields and low to negative interest rates, respectively. The looming Fed rate cut will shift the dynamics, leading to a sell-off in the USD and a buying surge in the JPY. To avoid missing profitable opportunities, traders should closely track this asset. In addition, if you’re an active market participant, consider enhancing your returns with the commissions offered by the best CFD affiliate programs for traders.

3. AUD/USD

Traders should watch AUD/USD because the Reserve Bank of Australia’s neutral stance and changing commodity prices can trigger sudden price movements, especially in August. Additionally, the Australian dollar often reacts strongly to global commodities, such as oil, as well as economic data. That makes this pair one of the best financial instruments for traders focusing on scalping around news-based economic releases and trend-following.

4. GBP/USD

Another USD-based currency pair that you shouldn’t overlook in August 2025 is GBP/USD. In early August, the Bank of England lowered its interest rate from 4.25% to 4.00%. This is a true reflection of the authority’s cautious stance. It also differs from the Fed Reserve since, despite the anticipated September cuts, the central bank has focused more on maintaining its 4.25-4.5% benchmark rate. Watch the pair keenly for short-term reactions and leverageable shifts.

5. USD/CHF

Tracking USD/CHF is advisable primarily because this is considered a safe-haven pair. And rightly so, since the CHF is backed first and foremost by Switzerland’s resilient economy and low inflation. While waiting for the anticipated Fed rate cuts, you can hedge against a weakening dollar by buying CHF against USD. And after the central bank makes its announcements, this pair can still help you capitalize on everything from geopolitical developments to changing equity market volatility.

Which Currency Pairs Should You Add to Your Portfolio?

Forex traders have access to a wide variety of opportunities in August 2025, thanks to central bank divergence, among other factors. That said, this guide has introduced you to 5 currency pairs that are worth your attention. All you have to do is pick the right options to add to your portfolio. When selecting the right instruments, consider all key factors, including prevailing central bank policies, market volatility, and liquidity. Also, spread risk by investing across multiple pairs and other assets.