28/10/2025
Written by: Ian Morley
Daily Currency Market Update – 28th October 2025
GBP/EUR
Summary: GBP/EUR fell to 1.1420 as traders responded to Germany’s weaker GfK Consumer Confidence reading and cautious ECB policy signals. The Euro found support from expectations that the ECB has ended its easing cycle, while the Pound remains pressured by rising BoE rate cut bets. UK fiscal concerns ahead of the Autumn Budget and signs of labour market cooling continue to weigh on Sterling.
Outlook: GBP/EUR may remain under pressure unless BoE commentary shifts. Eurozone GDP and German inflation data later this week will guide direction.
GBP/USD
Summary: GBP/USD holds near 1.3350 after snapping a six-day losing streak on Monday. The pair remains supported by improved risk sentiment and softer US Dollar, though BoE rate cut expectations limit upside.
Outlook: GBP/USD may consolidate ahead of Wednesday’s Fed decision. UK fiscal signals and US data will shape momentum.
EUR/USD
Summary: EUR/USD trades around 1.1650, extending its five-day rally amid risk-on flows and Fed rate cut expectations. The Euro shrugged off weaker German consumer confidence, buoyed by optimism over US-China trade progress and a rare earths deal with Japan.
Outlook: Euro may remain firm if Fed signals further easing. ECB tone and Eurozone GDP will be key for direction.
AUD/USD
Summary: AUD/USD trades near 0.6550 after gaining over 0.6% on Monday. The pair is supported by reduced RBA rate cut bets and optimism around US-China trade talks. RBA Governor Bullock noted the labour market remains “a little tight,” prompting markets to lower the probability of a November cut to 15%.
Outlook: AUD may remain volatile ahead of Wednesday’s Q3 CPI. China trade developments and RBA tone will guide direction.
USD/CAD
Summary: USD/CAD trades around 1.3990, extending losses as Fed rate cut expectations weigh on the Dollar. The Canadian Dollar faces headwinds from weaker oil prices and tariff tensions, with OPEC+ expected to raise output and Trump announcing a 10% hike on Canadian goods.
Outlook: CAD may remain pressured ahead of Wednesday’s BoC decision. Oil trends and trade sentiment will influence direction.
USD/CHF
Summary: USD/CHF trades below 0.7950, declining for a fourth session as SNB easing expectations fade. The Franc is supported by SNB commentary dismissing the need for further policy expansion, while the Dollar remains soft ahead of the Fed decision.
Outlook: USD/CHF may consolidate unless Fed signals hawkish intent. SNB tone and US-China trade optimism will shape CHF sentiment.
Final Summary
Sterling remains fragile amid BoE rate cut expectations and fiscal uncertainty. The Euro holds firm despite soft German data, supported by ECB policy stability and risk-on flows. The US Dollar weakens ahead of Wednesday’s Fed decision, with inflation data reinforcing easing bets. Commodity currencies are mixed, with AUD supported by trade optimism and reduced RBA cut expectations, while CAD is weighed by oil softness and tariff tensions. The Swiss Franc steadies as SNB signals no further easing.