Daily Market Update: 10 October 2025
Key Currency Pair Movements
GBP/EUR
- Summary: The GBP/EUR pair is holding losses near 1.1480 in the European session, extending its depreciation for the second successive day.
- Outlook: The currency cross loses ground as the Euro (EUR) receives support after the European Central Bank’s (ECB) September policy meeting showed policymakers broadly agreed the current policy stance remains consistent with the 2% medium-term inflation target. However, the cross may strengthen as the Euro could struggle due to the ongoing political turmoil in France, which has heightened investor concerns over the country’s fiscal deficit following the resignation of Prime Minister Sebastien Lecornu. The downside for the Pound Sterling (GBP) could be restrained as it receives support from the cautious tone surrounding the Bank of England’s (BoE) monetary policy outlook. BoE policymaker Catherine Mann noted that monetary policy must remain restrictive for longer as inflation remains persistent.
GBP/USD
- Summary: Pound Sterling holds onto losses near its two-month low around 1.3280 against the US Dollar (USD) during the European trading session on Friday, after falling about 0.75% on Thursday.
- Outlook: The GBP/USD pair trades vulnerably as the US Dollar exhibits strength, with an increase in its safe-haven demand following political developments in Japan and France. Pound Sterling is pressured despite dovish remarks from Federal Reserve officials, as BoE policymaker Catherine Mann supports keeping interest rates higher for a longer period.
EUR/USD
- Summary: The pair corrects higher early Friday but remains below 1.1600. It lost more than 0.5% on Thursday and closed the fourth consecutive day in negative territory.
- Outlook: The Euro is struggling for direction amid the ongoing political struggle in France, which continues to weigh on investor sentiment. The lack of progress in the US government shutdown, which has entered its tenth day, is supporting the US Dollar’s safe-haven appeal, keeping the pair pressured.
AUD/USD
- Summary: Following Thursday’s 0.5% loss, AUD/USD clings to small daily gains above 0.6560 in the European morning on Friday.
- Outlook: Reserve Bank of Australia (RBA) Governor Bullock said on Friday that services inflation remains “a little sticky” and added that the labour market is close to coming to balance despite being a little tight.
USD/CAD
- Summary: The USD/CAD pair holds steady at around 1.4000 in the European morning on Friday after having touched its highest level since April above 1.4030 earlier in the day.
- Outlook: Statistics Canada will publish the employment data for September today, which will be the primary driver for the Canadian Dollar. The Unemployment Rate in Canada is forecast to edge higher to 7.2% in September from 7.1% in August.
USD/CHF
- Summary: The pair holds a cautious stance below its recent high.
- Outlook: Growing expectations of inflation rising in the coming quarters in Switzerland are diminishing fears that the Swiss National Bank (SNB) could push interest rates into a negative territory. Latest comments from SNB Chairman Martin Schlegel have signalled that consumer inflation could accelerate in the coming quarters. This scenario is helping to restrain the Swiss Franc’s (CHF) weakness despite the broadly strong US Dollar (USD).
Final Summary
The US government shutdown continues, with Democrats and Republicans failing to make any progress on reopening the government, and the Senate will not return until Tuesday. Meanwhile, the New York Times reported that the US Bureau of Labour Statistics (BLS) is recalling a limited number of staff from furlough to complete the September Consumer Price Index (CPI) report, though the October 15 release date remains unclear.
In the UK, Chief Secretary to the Treasury James Murray said that the administration would not allow agencies to use emergency funds to fund pay rises, stating that this “prudent but tough approach to public spending is what will help build a stable economy”.
Written by: Ian Morley