Pound faces headwinds as UK unemployment rises
Philip McHugh June 10th 2025 - 2 minute read
Pound (GBP) flat amid UK spending review jitters
The pound (GBP) continued to trade without a strong directional bias on Monday as GBP investors awaited a couple of key data releases later in the week.
The uncertainty surrounding the UK government’s upcoming spending review also ensured movement in GBP exchange rates remained minimal.
Sterling is already off to a poor start this morning as the UK’s latest jobs data reported an uptick in unemployment and weaker-than-expected wage growth in April. Further signs that the UK labour market is slowing could put more pressure on the Bank of England (BoE) to ease its monetary policy.
Euro (EUR) muted despite German fiscal stimulus speculation
The euro (EUR) got off to a subdued start this week, with the single currency being undermined by its negative correlation with the US dollar (USD).
This offset growing speculation that Germany’s new government will unveil more fiscal stimulus measures when it publishes its first budget later this month.
In the absence of any impactful Eurozone data, the euro may remain highly sensitive to movement in the US dollar today.
US dollar (USD) rebounds on trade talk optimism
Trade in the US dollar was mixed on Monday, as the latest round of trade talks between the US and China took place in London.
The US dollar’s initial losses were erased during the US trading session as market participants appeared optimistic that the talks will help to defuse recent tensions.
USD exchange rates may trend higher today, depending on how successful the talks ultimately prove.
Canadian dollar (CAD) undermined by softer oil prices
The Canadian dollar (CAD) struggled to attract support at the start of this week as a softening of oil prices weakened the appeal of the commodity-linked currency.
If oil prices continue to slip through today’s session, it’s likely the ‘loonie’ may remain on the back foot.
Australian dollar (AUD) buoyed by improvement in morale
The Australian dollar (AUD) ticked broadly higher overnight on Monday, supported by improvements in Australian consumer and business confidence.
New Zealand dollar (NZD) wavers in mixed trade
The New Zealand dollar (NZD) treaded water in overnight trade as shifting market risk sentiment infused volatility into the currency.
Never miss a movement. Create a free account with Currencies Direct to get the latest currency news delivered straight to your inbox. You can also set up rate alerts and check live rates 24/7.
Written by
Philip McHugh