Economic worries, such as an unanticipated decline in the UK GDP and ambiguity around the Bank of England’s policy stance, are exerting pressure on the pound. The direction of sterling will be influenced by upcoming data, including employment and pay growth statistics. The value of the pound may be supported by stable or better-than-expected data, but it may be depreciated if the BoE makes any indications about possible rate reduction.
Early last week, the Euro experienced gains fuelled by hope for a possible truce in Ukraine. However, growing trade tensions between the US and EU, especially because of tariffs, hindered its growth. The Euro was affected by worries over Russia’s position on Ukraine and a possible trade war between the US and the EU. Data like Germany’s ZEW mood could have an impact on the Euro’s trajectory in the upcoming week.
The U.S. dollar fluctuated last week, falling to multi-month lows due to worries about US tariffs and the recession. Expectations of additional interest rate reductions from the Federal Reserve were prompted by these concerns. Later in the week, though, the dollar rebounded as concerns of a recession subsided due to lower-than-expected US inflation. The trajectory of the dollar will be largely determined by the Federal Reserve’s interest rate guidance going ahead.
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