} could be from a block arg or splice

scalafmt-core/shared/src/main/scala/org/scalafmt/internal/FormatOps.scala

@@ -1382,12 +1382,6 @@ class FormatOps(
     if (!ft.right.is[T.Comment] || isDone(ft)) ft else iter(ft)
   }
 
-  def xmlSpace(owner: Tree): Modification =
-    owner match {
-      case _: Term.Xml | _: Pat.Xml => NoSplit
-      case _ => Space
-    }
-
   def getSpaceAndNewlineAfterCurlyLambda(
       newlines: Int
   )(implicit style: ScalafmtConfig): (Boolean, NewlineT) =

scalafmt-core/shared/src/main/scala/org/scalafmt/internal/Router.scala

@@ -191,14 +191,19 @@ class Router(formatOps: FormatOps) {
             .withIndents(alignIndents.getOrElse(mainIndents))
             .withPolicy(decideNewlinesOnlyBeforeClose(close))
         }
-        def findArg = findInterpolateArgAfter(open.end, leftOwner)
+        def isSimpleInterpolate = (leftOwner match {
+          case t: Pat.Interpolate => findArgAfter(open.end, t.args)
+          case t: Term.Interpolate => findArgAfter(open.end, t.args)
+          case t: Term.Block => getBlockSingleStat(t)
+          case _ => None
+        }).exists(!_.is[Term.If])
+
         style.newlines.inInterpolation match {
           case Newlines.InInterpolation.avoid => Seq(spaceSplit)
           case _ if style.newlines.keepBreak(newlines) =>
             Seq(newlineSplit(0))
           case Newlines.InInterpolation.allow
-              if !dialect.allowSignificantIndentation ||
-                !findArg.exists(_.is[Term.If]) =>
+              if !dialect.allowSignificantIndentation || isSimpleInterpolate =>
             Seq(spaceSplit)
           case _ =>
             /* sequence of tokens:
@@ -216,8 +221,7 @@ class Router(formatOps: FormatOps) {
             )
         }
 
-      case FormatToken(_, _: T.RightBrace, _)
-          if rightOwner.is[SomeInterpolate] =>
+      case FormatToken(_, _: T.RightBrace, _) if isInterpolate(rightOwner) =>
         Seq(Split(Space(style.spaces.inInterpolatedStringCurlyBraces), 0))
 
       // optional braces: block follows

scalafmt-core/shared/src/main/scala/org/scalafmt/rewrite/RedundantBraces.scala

@@ -152,6 +152,13 @@ class RedundantBraces(ftoks: FormatTokens) extends FormatTokensRewrite.Rule {
       session: Session,
       style: ScalafmtConfig
   ): Replacement = {
+    def handleInterpolation =
+      if (
+        style.rewrite.redundantBraces.stringInterpolation &&
+        processInterpolation
+      ) removeToken
+      else null
+
     owner match {
       case t: Term.FunctionTerm if t.tokens.last.is[Token.RightBrace] =>
         if (!okToRemoveFunctionInApplyOrInit(t)) null
@@ -167,13 +174,11 @@ class RedundantBraces(ftoks: FormatTokens) extends FormatTokensRewrite.Rule {
           case Some(f: Term.FunctionTerm)
               if okToReplaceFunctionInSingleArgApply(f) =>
             replaceWithLeftParen
+          case Some(_: Term.Interpolate) => handleInterpolation
           case _ =>
             if (processBlock(t)) removeToken else null
         }
-      case _: Term.Interpolate
-          if style.rewrite.redundantBraces.stringInterpolation &&
-            processInterpolation =>
-        removeToken
+      case _: Term.Interpolate => handleInterpolation
       case Importer(_, List(x))
           if !(x.is[Importee.Rename] || x.is[Importee.Unimport]) ||
             style.dialect.allowAsForImportRename &&
@@ -219,7 +224,7 @@ class RedundantBraces(ftoks: FormatTokens) extends FormatTokensRewrite.Rule {
 
     def isLiteralIdentifier(arg: Term.Name): Boolean = {
       val syntax = arg.toString()
-      syntax.headOption.contains('`') && syntax.lastOption.contains('`')
+      syntax.nonEmpty && syntax.head == '`' && syntax.last == '`'
     }
 
     /** we need to keep braces

scalafmt-core/shared/src/main/scala/org/scalafmt/util/TreeOps.scala

@@ -12,6 +12,7 @@ import scala.reflect.ClassTag
 
 import org.scalafmt.Error
 import org.scalafmt.config.{DanglingParentheses, ScalafmtConfig}
+import org.scalafmt.internal.{Modification, Space}
 import org.scalafmt.internal.{FormatToken, FormatTokens}
 import org.scalafmt.util.InfixApp._
 
@@ -756,13 +757,6 @@ object TreeOps {
         }
     }
 
-  def findInterpolateArgAfter(end: Int, tree: Tree): Option[Tree] =
-    tree match {
-      case t: Pat.Interpolate => findArgAfter(end, t.args)
-      case t: Term.Interpolate => findArgAfter(end, t.args)
-      case _ => None
-    }
-
   def findArgAfter(end: Int, trees: Seq[Tree]): Option[Tree] =
     trees.find(_.pos.start >= end)
 
@@ -1067,4 +1061,13 @@ object TreeOps {
   def isParentAnApply(t: Tree): Boolean =
     t.parent.exists(_.is[Term.Apply])
 
+  def isTreeOrBlockParent(owner: Tree)(pred: Tree => Boolean): Boolean =
+    if (owner.is[Term.Block]) owner.parent.exists(pred) else pred(owner)
+
+  def xmlSpace(owner: Tree): Modification =
+    Space(!isTreeOrBlockParent(owner)(_.isAny[Term.Xml, Pat.Xml]))
+
+  def isInterpolate(tree: Tree): Boolean =
+    isTreeOrBlockParent(tree)(_.isAny[Term.Interpolate, Pat.Interpolate])
+
 }