Pound (GBP) supported by slight GDP rebound
The pound (GBP) edged higher yesterday after the UK’s latest GDP data showed a small uptick in growth for August.
Although the recovery was modest, it was enough to ease speculation that the Bank of England (BoE) might deliver another interest rate cut before the end of 2025.
Looking ahead, investors will focus on a speech from BoE Chief Economist Huw Pill today. As one of the most hawkish members of the BoE’s Monetary Policy Committee, Pill’s remarks could help extend the upside in Sterling.
Euro (EUR) steadied by easing French political risk
The euro (EUR) gained modestly on Thursday, buoyed by a calmer political atmosphere in France following a period of uncertainty.
Investor confidence improved after newly appointed Prime Minister Sébastien Lecornu survived two parliamentary confidence votes, avoiding another political crisis and preventing the need for new elections.
With limited Eurozone data due today, unless September’s final inflation reading is revised, the euro may struggle to find a strong sense of direction.
US dollar (USD) weighed down by upbeat market mood
The US dollar (USD) softened yesterday as investors favoured riskier assets, reducing demand for the safe-haven greenback.
Further dampening USD sentiment were dovish comments from several Federal Reserve officials, reinforcing market expectations that the central bank could maintain an accommodative stance.
The US dollar looks vulnerable to further losses today, amid fears over the resilience of US regional banks and the private credit sector.
Canadian dollar (CAD) subdued as oil weakness persists
The Canadian dollar (CAD) was little changed on Thursday, pressured by oil prices lingering near a five-month low.
The ‘loonie’ is expected to remain sensitive to developments in the energy market, with further declines in crude likely to weigh on the currency in the coming sessions.
Australian dollar (AUD) continues to slide after weak jobs data
The Australian dollar (AUD) remained under pressure during Friday’s Asian session, extending losses triggered by Thursday’s disappointing labour market figures. Markets are now pricing in an 85% chance of a November rate cut from the Reserve Bank of Australia (RBA).
New Zealand dollar (NZD) drifts amid cautious sentiment
The New Zealand dollar (NZD) traded without clear direction overnight, as a mixed risk environment left the risk-sensitive ‘kiwi’ lacking strong momentum.
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