Published: 28/11/2025 By ECAP
BUDGET BREEZE
Sterling is steady this morning after its post-Budget gains. The larger fiscal buffer and lower gilt yields have supported sentiment, helping the Pound hold recent highs. While the OBR highlighted weaker long term growth and rising taxes, the immediate fiscal picture has eased pressure. Markets still expect a Bank of England rate cut next month, which may limit further upside for sterling.
The Euro remains stable as investors look for updates on progress toward a Ukraine peace agreement. The softer US Dollar has offered some support, but trading has been muted with limited Eurozone data this week. Markets are now focused on upcoming ECB commentary for clearer direction. For the moment, the Euro is holding firm against the Dollar while staying rangebound against sterling.
The US Dollar continues to weaken as expectations build for a December Federal Reserve rate cut. Softer economic data and dovish signals from Fed officials have pushed market pricing toward nearly 90 percent odds for a cut. Speculation that Kevin Hassett could become the next Fed Chair has added to the softer tone. With US holiday-thinned trading, the Dollar remains under pressure heading into the weekend.
Data supplied by GC Partners