Published: 09/09/2025 By ECAP
MUTED PERFORMANCE
The British Pound traded in a narrow range at the start of the week, with limited movement due to a quiet UK data calendar. Market sentiment played a key role in guiding its direction, as investors looked ahead to upcoming retail sales figures for further clues. Without strong domestic drivers, the Pound’s performance remains muted, awaiting clearer signals to establish momentum in the days ahead.
The Euro has remained surprisingly resilient despite political upheaval in France, including the collapse of the Bayrou government. Investors appear confident in President Macron’s ability to install a new prime minister quickly, limiting uncertainty. However, political paralysis, protests, and weak public finances pose longer-term risks. If Macron fails to restore stability soon, market sentiment could shift, leaving the Euro more vulnerable in the weeks ahead.
The U.S. Dollar continued to weaken, hitting its lowest level in seven weeks as investors increasingly expect the Federal Reserve to cut interest rates in September. This sentiment follows disappointing U.S. labour data, which signalled a cooling job market. Caution also lingers ahead of key inflation figures due this week, keeping pressure on the Dollar. Ultimately, market participants remain sensitive to any signals that could shift rate expectations.
Data supplied by GC Partners