01/10/2025
Written by: Ian Morley
Daily Currency Market Update – 30th July 2025
GBP/EUR
Summary: GBP/EUR climbed to 1.1560, recovering from 20-month lows as Sterling rebounded on diverging monetary outlooks. The Euro softened despite upbeat German Retail Sales, as tariff uncertainty and cautious ECB commentary weighed. UK fiscal concerns persist, but the Pound found support from expectations that the BoE may slow quantitative tightening.
Outlook: Eurozone GDP and HICP data will be key. If UK data stabilises and ECB signals remain cautious, GBP/EUR may consolidate near current levels.
GBP/USD
Summary: GBP/USD trades near 1.3350, steadying after four days of losses. Sterling remains pressured by soft UK labour data and expectations of BoE easing, while the Dollar holds firm ahead of the Fed’s rate decision. Markets expect no change, but Powell’s press conference may offer clues on future policy amid tariff-driven inflation risks.
Outlook: If Powell signals a September rate cut and US data underwhelms, GBP/USD could rebound. Otherwise, downside risks persist.
EUR/USD
Summary: EUR/USD holds above 1.1550, recovering from multi-week lows. The Euro remains vulnerable despite strong German Retail Sales, as trade deal fallout and cautious sentiment ahead of Eurozone GDP weigh. French and German leaders have criticised the US–EU tariff agreement, adding to uncertainty.
Outlook: Eurozone GDP and inflation data will guide direction. If growth disappoints and Fed signals dovish intent, EUR/USD may stabilise.
USD/AUD
Summary: AUD/USD steadies near 0.6500 after breaking below key support. The Aussie was pressured by softer-than-expected Q2 CPI and weak Chinese retail sales. However, China’s pledge to boost domestic consumption and fiscal support helped limit losses.
Outlook: If risk sentiment improves and US Dollar softens post-Fed, AUD/USD may attempt a rebound. RBA commentary and Chinese growth signals remain pivotal.
USD/CAD
Summary: USD/CAD trades near 1.3770, flat ahead of dual rate decisions from the Fed and BoC. The Loonie remains under pressure from soft Canadian Retail Sales and lingering trade uncertainty, though oil prices have stabilised.
Outlook: If both central banks hold rates and signal caution, USD/CAD may remain range-bound. Canadian GDP and Fed tone will be key drivers.
USD/CHF
Summary: USD/CHF softens to 0.8055 as safe-haven demand for the Swiss Franc persists. The Dollar eased slightly ahead of the Fed decision, while geopolitical tensions and trade uncertainty continue to support CHF.
Outlook: If Fed signals dovish intent and global risk aversion deepens, USD/CHF could test support near 0.8000. Swiss data and US GDP will also influence direction.
Final Summary
Currency markets are cautious ahead of today’s Fed and BoC rate decisions, with no changes expected but policy tone in focus. Sterling rebounded against the Euro but remains soft versus the Dollar. The Euro steadied despite trade deal fallout, while commodity-linked currencies like the Aussie and Loonie are mixed on inflation and growth signals. The Swiss Franc remains supported by safe-haven flows.