By Noam Bennaiche
Yesterday, the US Dollar stayed under pressure against its major peers as ongoing policy uncertainty and geopolitical risks weighed on market sentiment, despite the Federal Reserve’s recent policy decision. The Fed left their interest rate unchanged at the 3.5%–3.75% target range on the 28th of January 2026. The Greenback’s weakness was further reinforced by White House comments and mixed Fed communication, leaving the Dollar trading near multi-year lows. The independence of the Fed is being questioned with President Trump making various comments, and seemingly exerting significant pressure on their policy decisions.
The Pound traded close to multi-year highs against the US Dollar, supported by broad USD weakness and relatively resilient UK economic data. Attention is now shifting toward upcoming Bank of England communication and UK political developments, which could shape Sterling’s direction into February. Against the Euro, Sterling was broadly stable, briefly rising before easing back toward the end of the session.
The Euro continued to benefit from Dollar fragility, pushing above key resistance levels. For now, EUR/USD is moving mainly in response to what is happening in the United States, rather than news from the Eurozone.
The market is still waiting for the Federal Reserve to provide clearer signals about interest rates in 2026, or the Eurozone showing stronger economic momentum to show a clear breakout.
With only a limited number of data releases yesterday in the Eurozone and in the UK, price action was driven mainly by broader macro sentiment and central bank narratives rather than fresh economic indicators. In the US, Jobless Claims came in at 209K, dropping slightly but still higher than expectations, which shows a the jobs market not recovering as hoped.
Looking ahead to the final trading day of the month, markets will focus on key US employment, inflation and GDP data, which could significantly influence expectations for Fed policy and the near-term direction of the Dollar. In the Euro area, upcoming sentiment and industrial data will be closely watched. For Sterling, upcoming UK inflation figures and PMI releases will be crucial in determining whether the Bank of England maintains a restrictive or more neutral policy stance, particularly if political uncertainty re-emerges.
Overall, the Dollar outlook into month-end remains biased to the downside unless US data materially alters rate expectations, while both the Pound and the Euro could retain their gains if policy divergence and macro surprises continue to weigh on the Greenback. Planning a transfer? Reach out to your currency consultant today and make the most of your money.
Friday, 30th January
EUR — German GDP (Q4 Preliminary) at 09:00 GMT
EUR — Eurozone GDP (Q4 Preliminary) at 10:00 GMT
USD — Producer Price Index (PPI) MoM (Dec) at 13:30 GMT
USD — Core PPI MoM (Dec) at 13:30 GMT
USD — Chicago PMI (Jan) at 14:45 GMT