Pound (GBP) steady despite UK–China ties
The pound (GBP) stayed locked in a tight range yesterday, with Sterling traders largely brushing off the announcement of several new agreements between the UK and China.
Although the UK government highlighted the potential benefits of the deals signed in Beijing, analysts downplayed their likely economic impact, suggesting any boost to growth would be limited.
Looking ahead, the pound may continue to drift through the rest of the week amid the ongoing lack of UK economic data.
Euro (EUR) subdued amid ECB cut chatter
The euro (EUR) struggled to find momentum on Thursday, as recent comments from European Central Bank (ECB) officials regarding the strength of the single currency continued to weigh on sentiment.
This capped the impact of the Eurozone’s latest economic sentiment index, which climbed to a three-year peak this month.
Today’s focus turns to the Eurozone’s latest GDP release, with the euro at risk of slipping if growth slowed in the final quarter of 2025.
US dollar (USD) rebounds as Warsh tops Fed shortlist
The US dollar (USD) initially faltered yesterday as persistent concerns over a potential US government shutdown prompted investors to add a risk premium to USD.
However, the ‘greenback’ recovered later in the session amid growing expectations that US President Donald Trump will nominate Kevin Warsh as the next Federal Reserve Chair.
Warsh is viewed as the most hawkish contender still under consideration, and confirmation could help underpin the US dollar through today’s trade.
Canadian dollar (CAD) supported by firmer oil prices
The Canadian dollar (CAD) advanced on Thursday, with a sharp upswing in oil prices lifting demand for the commodity-linked currency.
Should crude prices continue to climb to fresh multi-month highs, the ‘loonie’ may remain well supported into the end of the week.
Australian dollar (AUD) eases amid USD rebound
The Australian dollar (AUD) edged lower in overnight trade on Thursday, pressured by the recovery in the US dollar alongside softer commodity prices.
New Zealand dollar (NZD) weighed down by softer risk mood
The New Zealand dollar (NZD) also slipped in overnight trade as a pullback in market risk appetite dampened demand for the ‘kiwi’.
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