Diplomacy Influences
GBP
The British Pound remains well supported near two-month highs against the Euro, helped by hopes of closer UK-EU ties and expectations of stronger UK economic growth. The pound has also gained support from expectations that the Bank of England could take a firmer approach to interest rates. With little UK economic data due, the Pound’s performance is likely to remain influenced by investor confidence, expectations around UK policy and wider market sentiment.
EUR
The Euro struggled to gain support as it faced pressure from broader market movements. However, stronger than expected inflation could improve confidence in the euro by increasing expectations that European policymakers may take a firmer approach to interest rates. If price pressures continue to rise, the euro could find some support as investors reassess the outlook for the European economy and the European Central Bank’s future decisions.
USD
The US Dollar gained support as geopolitical tensions increased demand for safer assets. Higher oil prices and concerns about global instability also helped the dollar strengthen. Despite weaker than expected US manufacturing figures, factory activity continued to expand. Looking ahead, the dollar’s direction could be influenced by the latest US jobs figures, with stronger employment potentially supporting the currency and weaker results potentially weighing on it.
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