Published: 07/03/2025 By ECAP
The British Pound struggled to gain ground against major currencies, including the Euro. In fact, the Pound to Euro exchange rate dipped to five-week lows, with limited movement due to a lack of significant economic data. Despite hawkish comments from the Bank of England, Sterling remained largely unchanged, with little direction expected until upcoming economic releases.
The Euro strengthened following the ECB's 25-basis point rate cut and hawkish comments from ECB President Lagarde, signalling limited scope for future cuts. Despite the rate reduction, Lagarde's stance on being "data-driven" in future decisions boosted the Euro. Ultimately, although geopolitical tensions and downside risks to growth remain, infrastructure spending may support growth and inflation, enhancing the Euro's outlook.
The U.S. Dollar remained near a four-month low, pressured by fears of a U.S. economic slowdown and the uncertainty surrounding Trump's policies, including tariffs. Looking forward, today’s nonfarm payrolls data is expected to provide key insights into the labour market. Any signs of a cooling economy could potentially hurt the greenback further.
Data supplied by GC Partners