Published: 18/07/2025 By ECAP
Limited Momentum
The British Pound remained mostly flat as mixed UK labour market data limited its momentum. Moreover, an unexpected rise in unemployment and slower wage growth increased expectations of a Bank of England rate cut, weighing on Sterling. Ultimately, with no major UK data releases scheduled, the Pound is likely to lack clear direction and will instead respond to broader market sentiment and global risk appetite in the near term.
The Euro remained muted as markets awaited Germany’s producer price index, expected to show further disinflation. A weak reading could boost European Central Bank rate cut bets and weigh on the Euro. With little impactful Eurozone data released, sentiment stayed cautious. Ultimately, broader geopolitical developments and easing inflation trends continue to influence the Euro's outlook, as investors assess the likelihood of further monetary policy adjustments.
The U.S. Dollar remained resilient, heading for its second straight weekly gain despite brief dips amid political tensions and interest rate uncertainty. For now, strong retail and inflation data reinforced the Federal Reserve’s cautious stance, while potential tariff escalations added further support. Ultimately, although volatility rose following speculation around Fed Chair Powell’s future, the broader outlook favoured the Dollar, with markets closely watching inflation and policy developments.
Data supplied by GC Partners