Published: 12/12/2025 By ECAP
DATA DRAG
The British Pound is softer this morning after UK GDP unexpectedly contracted by 0.1% in October, beyond expectations for modest growth. The weaker data highlights slow spending and production, prompting fresh market speculation that the Bank of England may cut rates at its December meeting next Wednesday. With soft domestic indicators, the Pound is facing downward pressure ahead of next week’s key UK labour and growth releases.
The Euro is firm as EUR/USD pushes to fresh multi-week highs following broad Dollar weakness. With little Eurozone data today, the shared currency is drawing strength from improvement in risk sentiment and technical momentum. ECB officials have recently expressed confidence that inflation will settle near target, helping support the Euro amid softer UK and US data. Markets will watch next week’s ECB rate decision and policy statement for further clues.
The US Dollar remains under pressure after a fresh Federal Reserve rate cut this week lowered the funds range to 3.50–3.75%. Chair Powell highlighted signs of cooling inflation and weakness in employment, and the updated projections showed only modest easing expected next year, which has reduced the Dollar’s yield advantage. Attention is now on next week with a flurry of data releases including non-farm payrolls, retail sales and inflation data.
Data supplied by GC Partners