01/10/2025
Written by: Ian Morley
Daily Currency Market Update – 24th June 2025
GBP/EUR
Summary: GBP/EUR climbed above 1.1700 as risk appetite improved following the announcement of a ceasefire between Israel and Iran. The Pound was further supported by stronger-than-expected UK flash PMI data, with the services sector expanding at its fastest pace in three months. Meanwhile, the Euro remains under pressure as ECB officials, including Villeroy de Galhau, signalled that further rate cuts remain possible amid concerns over trade policy and growth.
Outlook: Speeches from BoE Governor Bailey and ECB President Lagarde later today could influence direction. If Bailey maintains a cautious tone and Lagarde leans dovish, GBP/EUR may extend gains.
GBP/USD
Summary: GBP/USD surged to near 1.3600 as safe-haven demand for the US Dollar faded following the ceasefire announcement. The Pound was buoyed by upbeat UK PMI data and expectations that the BoE will maintain a gradual approach to easing. Meanwhile, dovish comments from Fed officials, including Bowman and Waller, increased speculation of a July rate cut.
Outlook: BoE and Fed commentary will be key. If Powell reinforces dovish guidance in his testimony, GBP/USD could attempt to retest the 1.3630 high from earlier this month.
EUR/USD
Summary: EUR/USD reclaimed the 1.1600 handle as the Dollar weakened on improved risk sentiment and dovish Fed rhetoric. ECB President Lagarde warned of downside risks to Eurozone growth, citing trade tensions and inflation uncertainty, but the Euro held firm on reduced geopolitical risk.
Outlook: The pair may remain supported if Powell signals a July rate cut. However, any signs of economic fragility in the Eurozone could limit further upside.
USD/AUD
Summary: AUD/USD extended gains above 0.6550 as risk-on sentiment returned and Australian PMI data surprised to the upside. The ceasefire between Israel and Iran, along with dovish Fed expectations, helped lift the Aussie.
Outlook: The pair may remain supported if Powell’s testimony confirms a dovish Fed stance. However, any renewed geopolitical tension could cap gains.
USD/CAD
Summary: USD/CAD edged lower to around 1.3700 as oil prices fell sharply following the ceasefire, but the Canadian Dollar remained resilient ahead of today’s CPI release. The Greenback weakened on dovish Fed commentary and improved market sentiment.
Outlook: Canadian inflation data will be pivotal. A stronger-than-expected print could support CAD and push USD/CAD lower, especially if Powell maintains a dovish tone.
USD/CHF
Summary: USD/CHF slipped below 0.8150 as safe-haven demand for the Swiss Franc persisted despite easing geopolitical tensions. The Dollar remains under pressure from dovish Fed expectations, while the SNB’s signal that no further rate cuts are planned has supported CHF.
Outlook: Powell’s testimony and US consumer confidence data will guide near-term movement. If Fed rhetoric remains dovish, USD/CHF could test lower levels.
Final Summary
Markets welcomed the Israel-Iran ceasefire, triggering a broad risk rally and weakening the US Dollar. The Pound gained on upbeat PMI data and reduced geopolitical risk, while the Euro held firm despite cautious ECB commentary. Commodity-linked currencies like the Aussie and Loonie benefited from improved sentiment, though oil’s sharp decline weighed on CAD. The Swiss Franc remained supported by safe-haven flows and a steady SNB outlook. Attention now turns to Powell’s testimony and Canadian CPI for the next directional cues.