Pound Sterling (GBP)
GBP: The British Pound remained under pressure last week as weak UK economic data weighed on sentiment. GDP growth for the three months to September was just 0.1%, highlighting a slowing economy, while inflation eased to 3.6%, giving the Bank of England potential room for rate adjustments. Market attention has increasingly focused on the upcoming Autumn Budget, with concerns that a lack of credible fiscal measures could further weaken the Pound. Sentiment remains bearish, though there is potential for a relief rally if the budget surprises positively.
Euro (EUR)
EUR: The Euro experienced modest fluctuations amid mixed signals from the Eurozone. While the European Commission upgraded its 2025 growth forecast to 1.3% and noted easing inflation pressures, uncertainties around domestic demand and external shocks kept investors cautious. Core inflation is projected to decline gradually, and the ECB’s data-dependent approach to monetary policy suggests any policy moves will be cautious. Overall, the Euro showed resilience, but gains are likely to remain limited unless economic activity surprises on the upside.
U.S. Dollar (USD)
USD: The US Dollar traded mixed on Tuesday as markets awaited the Federal Reserve’s interest rate decision later in the day. Expectations of a 25-basis-point rate cut have kept movements subdued, with the Dollar firming slightly amid a risk-off backdrop. Generally, confirmation of the expected cut could see the Dollar weaken moderately, whereas a larger cut or a more dovish tone from the Fed might trigger sharper declines.