Published: 09/12/2025 By ECAP
CURRENCY CROSSWINDS
The British Pound is a little weaker this morning as last week’s post Budget boost begins to fade. Markets are turning their focus back to the UK’s softer economic outlook, with rising unemployment and slower growth expected next year. Many analysts now think the Bank of England will cut interest rates again early in 2026. With no major UK data this week, sterling is likely to be driven by wider market moves.
The Euro is slightly weaker this morning as it eases back from recent highs. With no major Eurozone data early this week, traders are looking to the ECB for direction. Despite today’s softer tone, the Euro remains supported by expectations that the Fed will cut rates while the ECB keeps policy steady. For now, the Euro is holding in a relatively stable range.
The U.S. Dollar is holding firmer today after dipping to recent lows. Traders are waiting for Wednesday’s Federal Reserve meeting, where another rate cut is widely expected. Until then, the Dollar is likely to move within a tight range. The recent rebound suggests investors are being cautious about how quickly US rates might fall.
Data supplied by GC Partners