By James Tucker
Last week sterling remained strong, particularly against the dollar. GBP/USD traded near recent highs as the dollar weakened earlier in the week due to uncertainty around US economic policy and Federal Reserve leadership. Sterling was more mixed against the euro, with GBP/EUR broadly stable as both currencies showed relative resilience.
The US dollar experienced a volatile week. It came under pressure initially as investors grew cautious over policy direction and global risk sentiment. However, the dollar recovered some ground toward the end of the week following news that supported confidence in the Federal Reserve’s future leadership. Overall, the USD finished the week mixed, weaker than recent highs but no longer under heavy selling pressure.
The euro showed modest strength, benefiting from early-week dollar weakness and steady messaging from the European Central Bank. EUR/USD held relatively firm, though gains were limited as markets remained cautious ahead of further US data and central bank developments. The euro’s outlook remains closely tied to relative growth expectations between the eurozone and the USA.
In summary, GBP was the strongest performer against the USD, the euro remained stable, and the dollar saw a choppy but slightly improved finish. Looking ahead, central bank guidance and economic data releases will remain the key drivers across all three currencies.
Market attention is increasingly focused on the upcoming Bank of England signals and this week’s interest rate decision which could drive near-term volatility in the pound so please stay in close contact with the team at A Place in the Sun Currency if you have any upcoming transfer requirements.
Data this week
Monday
7am EUR retail sales
3pm USD Manufacturing PMI
Tuesday
3am AUD Interest rate decision
9am ECB bank lending Survey
2.40pm USD Fed’S bowman’s speech
Wednesday
10am EUR consumer price index
1.15pm USD Employment change
3pm USD PMI services
Thursday
10am EU retails sales
12pm UK interest rate decision / minutes
1.45 ECB press conference
Friday
1.30pm USD unemployment rate