Pound Sterling (GBP)

The British Pound is under pressure due to economic concerns, including an unexpected contraction in UK GDP and uncertainty surrounding the Bank of England’s policy outlook. Upcoming data, such as wage growth and employment figures, will play a key role in shaping the Pound’s trajectory. If the BoE signals potential interest rate cuts, the Pound could potentially weaken, whereas stable or stronger-than-expected data may help support it.

Euro (EUR)

The Euro experienced gains early last week, driven by optimism over a possible ceasefire in Ukraine. However, its progress was limited by rising trade tensions between the US and the EU, particularly due to tariffs. Concerns over a potential EU-US trade conflict, alongside Russia’s position on Ukraine, weighed on the Euro. Looking ahead, data such as Germany’s ZEW sentiment index could influence the Euro’s direction in the coming week.

U.S. Dollar (USD)

The US Dollar fluctuated last week, reaching multi-month lows amid recession fears and concerns over US tariffs. These worries heightened expectations of further interest rate cuts from the Federal Reserve. However, the Dollar rebounded later in the week after weaker-than-expected US inflation helped ease recession concerns. Moving forward, the Federal Reserve’s guidance on interest rates will be key in determining the Dollar’s direction.