Published: 16/04/2025 By ECAP
The British Pound rose to a six-month high against the Dollar, buoyed by optimism over a potential UK-US trade deal and a broadly risk-on market mood. Despite mixed UK employment data and cooling wage growth reinforcing BoE rate cut expectations, Sterling held strong. Ultimately, hopes of tariff flexibility and trade progress with the US supported GBP, even as other currencies struggled against a fluctuating Dollar backdrop.
The Euro retreated slightly amid risk-on sentiment and a sharp drop in German economic morale, with the ZEW index plunging in April. Caution ahead of the ECB’s rate decision also limited movement. However, Bank of America noted strong Euro demand from institutional "Real Money" investors, particularly in the Americas, signalling long-term bullish potential if this trend continues and activity increases.
The U.S. Dollar faced pressure during yesterday’s trading session as risk-on sentiment and optimism around a UK-US trade deal lifted rival currencies. Although the Dollar showed brief strength earlier in the session, mixed messages on tariffs and broader economic concerns kept pressure on the currency throughout the day.
Data supplied by GC Partners