01/10/2025
Written by: Ian Morley
Daily Currency Market Update – 10th June 2025
GBP/EUR
Summary: GBP/EUR dropped below 1.1820 following weaker-than-expected UK labour market data. The latest figures showed an uptick in the UK’s ILO Unemployment Rate to 4.6%, its highest level since July 2021, while wage growth slowed more than anticipated. These signs of a cooling labour market may increase pressure on the Bank of England to ease monetary policy, weighing on Sterling. Meanwhile, the Euro remains relatively resilient as ECB President Christine Lagarde signalled that the central bank’s easing cycle may be nearing its end.
Outlook: Markets will be watching further ECB policy signals and UK growth figures later this week. If Eurozone inflation remains subdued, the Euro may struggle, supporting GBP/EUR in the near term.
GBP/USD
Summary: GBP/USD trades below 1.3550 as the Pound comes under selling pressure following disappointing UK labour market data. Meanwhile, the US Dollar holds its ground as investors await the outcome of US-China trade talks in London. The US Dollar Index (DXY) has edged higher above 99.00, reflecting broader cautious sentiment.
Outlook: Market participants will be watching any developments from US-China negotiations and upcoming US inflation data. If trade discussions yield positive results, risk appetite could improve, influencing GBP/USD movement.
EUR/USD
Summary: EUR/USD remains steady near 1.1400 as the markets await updates from US-China trade talks. Sentiment in the Euro was boosted slightly after China’s Vice President Han Zheng expressed willingness to strengthen ties with the EU, supporting the outlook for European exports. However, Eurozone inflation fell below the ECB’s 2% target for the first time since 2024, adding uncertainty to monetary policy expectations.
Outlook: The pair’s movement today will depend on the tone of US-China trade talks and any further commentary from ECB officials regarding future rate moves.
USD/AUD
Summary: AUD/USD fluctuates above 0.6500 as mixed Australian data and global trade uncertainty weigh on sentiment. Australia’s Westpac Consumer Confidence declined to 0.5% in June from 2.2% in May, reflecting cautious consumer outlook amid economic uncertainty. Meanwhile, the Australian Dollar saw mild support as risk appetite stabilised following trade discussions.
Outlook: Market sentiment will be shaped by global trade developments and upcoming Chinese economic indicators. If US-China tensions escalate, risk-sensitive assets like the Aussie may face further downside.
USD/CAD
Summary: USD/CAD holds above 1.3700 as market sentiment stabilises following positive comments from US officials regarding trade negotiations. Treasury Secretary Scott Bessent described Monday’s discussions as “good,” while Commerce Secretary Howard Lutnick called them “fruitful,” lending optimism to global trade prospects. Meanwhile, crude oil prices remain steady, providing modest support for the Canadian Dollar.
Outlook: Further developments from US-China talks and the upcoming US inflation report will shape USD/CAD direction. Any signs of trade progress could support risk sentiment, weighing on USD.
USD/CHF
Summary: USD/CHF trades near 0.8225 as the US Dollar sees mild support amid ongoing trade discussions. President Trump’s positive remarks regarding the negotiations helped stabilise sentiment, though broader geopolitical tensions continue to impact safe-haven demand for the Swiss Franc. Meanwhile, rising concerns over Swiss inflation may influence expectations regarding the Swiss National Bank’s policy stance.
Outlook: The focus remains on US-China trade talks and upcoming US inflation data. If tariff disputes ease further, USD/CHF may stabilise, but continued uncertainty could reinforce safe-haven demand for CHF.
Final Summary
Currency markets remain cautious as investors closely monitor US-China trade negotiations, with the US Dollar holding firm while the Pound Sterling struggles following weak UK employment data. The Euro remains stable ahead of further ECB signals, while commodity-linked currencies, including the Australian and Canadian Dollars, react to trade developments and domestic economic indicators. Traders will focus on upcoming inflation reports and central bank commentary for fresh market direction.