01/10/2025
Written by: Ian Morley
Daily Currency Market Update – 6th August 2025
GBP/EUR
Summary: GBP/EUR trades near 1.1480, recovering modestly after Monday’s dip. The Pound remains under pressure ahead of Thursday’s BoE rate decision, with markets pricing in a 25 bp cut. However, the Euro softened slightly following weaker-than-expected Sentix investor confidence, which fell to -3.7 in August.
Outlook: If the BoE signals a cautious easing path and Eurozone sentiment remains subdued, GBP/EUR may attempt further gains. Eurozone Producer Prices and UK Services PMI revisions will be closely watched.
GBP/USD
Summary: GBP/USD holds near 1.3280, supported by a softer Dollar and stabilising risk sentiment. The Pound continues to benefit from short covering ahead of the BoE meeting, while the Dollar paused its rally following last week’s weak NFP and ISM Services data.
Outlook: If Fed rhetoric turns more dovish and UK data holds firm, GBP/USD may extend gains. US trade balance and UK mortgage lending figures will guide direction.
EUR/USD
Summary: EUR/USD consolidates above 1.1550, supported by resilient Eurozone inflation and cautious Fed expectations. The Euro remains firm despite weaker investor sentiment, while the Dollar struggles to regain momentum after disappointing US data.
Outlook: Eurozone PPI and US trade data will be pivotal. If inflation holds and Fed cut bets persist, EUR/USD may remain supported.
USD/AUD
Summary: AUD/USD trades near 0.6520, steady after mixed domestic data. Australian inflation surprised to the upside, but employment concerns and weak Chinese PMI continue to weigh. The Aussie remains sensitive to risk sentiment and RBA policy expectations.
Outlook: If Chinese growth falters and US data firms, AUD/USD may drift lower. RBA commentary and trade headlines will be key.
USD/CAD
Summary: USD/CAD holds near 1.3780, supported by subdued oil prices and cautious sentiment ahead of Canadian GDP data. The Loonie remains vulnerable following Trump’s tariff hike and mixed domestic indicators.
Outlook: If Canadian growth disappoints and US data remains firm, USD/CAD could push higher. Oil price trends and Fed commentary will also influence direction.
USD/CHF
Summary: USD/CHF trades around 0.8050, consolidating after recent gains. The Swiss Franc remains supported by safe-haven flows and tariff concerns, while the Dollar steadies ahead of key data releases.
Outlook: If geopolitical tensions persist and Swiss data remains soft, USD/CHF may stay elevated. US trade figures and SNB commentary will guide movement.
Final Summary
Sterling steadies ahead of the BoE decision, while the Euro consolidates on resilient inflation and mixed sentiment data. The US Dollar remains subdued following weak labour and services figures, with traders reassessing Fed rate cut expectations. Commodity-linked currencies like the Aussie and Loonie are mixed, and the Swiss Franc continues to attract safe-haven demand.