25/04/2025
Written by: Ian Morley
Daily Currency Update – 20th March 2025
GBPEUR
Summary: The Pound weakened against the Euro following the latest UK employment data, which showed an increase in jobless claims. The UK unemployment rate held steady at 4.4%, but the rise in claimant count weighed on Sterling. Meanwhile, the Euro found support after Germany’s parliament approved a major spending package, providing a boost to economic sentiment.
Outlook: The Bank of England is expected to keep rates steady at 4.5% today, with attention on the vote split for any signs of shifting policy direction. Meanwhile, the Euro could remain supported if ECB President Christine Lagarde’s comments reinforce economic optimism.
GBPUSD
Summary: The Pound edged lower against the US Dollar after the Federal Reserve held interest rates at 4.25%-4.5%. Fed Chair Jerome Powell reiterated that the central bank will be cautious on rate cuts, leading to a slight recovery in the USD. The latest UK jobs report did little to support Sterling, as hiring momentum appears to be slowing.
Outlook: The BoE’s rate decision later today could set the tone for GBP/USD. If the vote split hints at a dovish shift, Sterling may remain under pressure. Meanwhile, US Initial Jobless Claims data will be watched for further clues on labour market strength.
EURUSD
Summary: The Euro lost ground against the Dollar on Wednesday, snapping a three-day winning streak. The Federal Reserve’s decision to hold rates steady kept USD supported, while uncertainty over Trump’s trade policies added further caution to markets.
Outlook: Markets will be closely watching ECB President Christine Lagarde’s speech today. Any indication of further rate cuts could weaken the Euro. On the US side, Jobless Claims and Existing Home Sales data could provide direction for the Dollar.
USDCHF
Summary: The Swiss Franc weakened after the Swiss National Bank (SNB) cut interest rates by 25bps to 0.25%, as expected. This move put downward pressure on CHF, allowing USD/CHF to climb back above 0.8800.
Outlook: The SNB’s dovish stance could keep CHF under pressure in the near term. Meanwhile, US economic data will be the key driver for the USD, with any signs of labour market strength potentially pushing USD/CHF higher.
AUDUSD
Summary: The Australian Dollar weakened after disappointing employment data, with job losses of 52.8k in February. Meanwhile, the Fed’s steady policy stance kept USD firm, limiting AUD/USD’s upside.
Outlook: The Aussie may struggle in the near term as soft labour market data reinforces expectations of RBA rate cuts later this year. Attention now turns to US data for further direction.
USDCAD
Summary: The Canadian Dollar remained under pressure as USD/CAD traded above 1.4300 following the Fed’s decision to hold rates steady. However, a rebound in oil prices helped limit CAD losses.
Outlook: The Bank of Canada’s stance on monetary policy, along with crude oil price movements, will continue to drive CAD’s performance. Any signs of economic slowdown could push USD/CAD higher.
Final Summary:
The focus today is on the Bank of England’s rate decision and ECB President Lagarde’s speech, both of which could influence GBP and EUR movements. Meanwhile, the USD remains stable after the Fed’s rate hold, with upcoming US labour market data likely to provide further direction. The Swiss Franc is under pressure after the SNB’s rate cut, while the Australian Dollar is struggling after weak jobs data.