Weekly Round-Up & The Week Ahead

Weekly round-up and a look at the week ahead for EUR, GBP, and USD.

USD

Last week we saw the US CPI inflation figures prove there is still inflationary concerns hovering over the US economy which was also reflected in Retail Sales showing us consumers are being cautious with their spending. This will weigh on the minds of the FED when discussions on interest rates resurface. Today we have a bank holiday in the US (Martin Luther King day), we also see the inauguration of President Trump, which is ultimately seen as formality, however, what can we expect in the coming months, it has been widely spoken about a complete change in life in the US, which will include changes in immigration, energy, culture, schools, and foreign policy. The President has done it all before, and couple with a break in between terms, would have provided the President time and space to plan and build a team that he feels will assist in the changes he feels that country needs to make. Many executive orders are expected to be signed off from day one and markets are eagerly sitting on the sidelines to see the effects this could take place.

Although, GBPUSD opened above the 1.22 handle, it has retraced and now sits below, a low volatility day expected.

No Data Releases Today

EUR

The Euro area economy is forecasted to present many challengers with Trade uncertainties with the US and it’s on ongoing fiscal tightening. US President Trump’s planned tariffs is likely to weigh heavily on the Eurozone growth and the ECB’s hopes of managing inflation throughout 2025.

As Germany continues to suffer stagnation in its economy and an election looming in the back ground for February, coupled with Frances political turmoil and still no clear path through the fiscal uncertainty and the changes required. The bloc will be cautiously moving cautiously as it awaits the President Trump 2.0, and understand what that actually means when it comes to changes in their own foreign policy. Labour market conditions provide further evidence of inflationary pressures, and with the Eurozone performance to remain underwhelming, the risk of it falling into a greater recession is a reality.

GBPEUR since opening, have continued its downward trend, and with little to no data release, a sense of drifting will take place.

No Date Releases today.

GBP

Last week, the UK not only experienced negative GBP output month on month, Consumer spending also disappointed with issues in the cost of goods still at all-time high, and the publics concerns in the rising energy, utility bills and overall cost of everyday items on the horizon. The new budget is set to come into force in the spring and this will bring the unpopular tax rises with it.

Inflation still remains a concern of the Bank of England, and what sort of interest rate movements could take place, with uncertainty in the Euro area and the tariffs in the US, which we should begin to understand in detail in the coming months.

No Data Releases Today

Daily Rates

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