Pound (GBP) slips amid BoE rate cut bets
The pound (GBP) traded on the back foot yesterday, pressured by mounting bets the Bank of England (BoE) will deliver a 25bps interest rate cut at its next meeting.
UK political jitters added to the headwinds facing Sterling, amid speculation that a Labour loss at next week’s Gorton and Denton byelection could be the final nail in the coffin for Keir Starmer’s premiership.
Surprisingly strong UK retail sales are helping to revive Sterling sentiment this morning, with further gains likely if the UK’s services PMI also surprises to the upside.
Euro (EUR) muted as consumer confidence remains downbeat
The euro (EUR) struggled to find any meaningful support on Thursday, following the publication of the Eurozone’s latest consumer confidence figures.
While morale showed signs of improvement this month, it fell short of forecasts, leaving the single currency on the defensive.
Today also sees the publication of the Eurozone’s own PMI data, with the euro potentially firming if private sector growth accelerated this month.
US dollar (USD) rises as jobless claims fall
The US dollar (USD) strengthened on Thursday amid fresh signs of US labour market resilience, following a larger-than-expected fall in US jobless claims last week.
Aiding the US dollar’s ascent was a rise in safe-haven demand amid reports that the US could launch military strikes on Iran this weekend.
The spotlight today will be on the latest US GDP print. Growth is expected to have slowed in the last quarter of 2025 amid the government shutdown. Will this reverse some of the US dollar’s recent gains?
Canadian dollar (CAD) buoyed by rising oil prices
The Canadian dollar (CAD) firmed on Thursday as an uptick in oil prices reflected positively on the commodity-linked currency.
Canada’s latest retail sales figures could provide a boost for the ‘Loonie’ later this week if January’s figures report an uplift in consumer spending.
Australian dollar (AUD) slides on soft PMI data
The Australian dollar (AUD) retreated through Friday’s Asian trading session after Australia’s latest PMI figures fell short of expectations.
New Zealand dollar (NZD) dented by weak trade data
The New Zealand dollar (NZD) also stumbled in overnight trade as New Zealand reported a fall in exports at the start of 2026.
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