What's Happening in the Markets?

Looks like some big money and world talks are going on. Here are the main things you should know:

• USA and China Talking: The United States and China are trying to sort out a big trade deal. They just had some important meetings in London, and it seems like they're making progress on how to do it. These talks might even continue past July 9th!
• Pound vs. Euro: If you're thinking about traveling to Europe, your British Pounds aren't buying as many Euros right now. This is because of some recent news about jobs.
• US Money Watch: People are waiting to hear how prices are changing in the US (this is called the "CPI print"). This news can affect how strong the US dollar is.
• UK's Big Plans: In the UK, the Chancellor is going to announce infrastructure and housing spending plans today.

Market Recap:

Here's a quick rundown of what's been happening in the financial world and what it could mean for you.

• Pound Weakens Against the Euro:

If you're planning any business with Europe, you might notice that the British Pound isn't as strong against the Euro as it has been. In fact, it hit its lowest point in a month today. Why? Well, some recent job numbers weren't as good as people hoped. This has led many to believe that the Bank of England might now wait until September to cut interest rates, rather than doing it sooner. This expectation has put a bit of pressure on the Pound.

• US Dollar Steady Amidst US-China Talks:

The US Dollar didn't see much movement yesterday. That's because the United States and China are still in the middle of discussions. These talks have been going on for a second day, and as long as they continue, the dollar tends to stay relatively calm as everyone waits to see the outcome.

In short, disappointing job figures are weighing on the Pound, while ongoing international talks are keeping the US Dollar stable for now.

Today’s Market Update:

• US-China Trade: A Step Forward, But Details Needed:

Overnight, the US and China announced they've agreed on a framework to ease their trade tensions. This is good news, as it means they're finding a way to implement what they discussed in May and avoid those high tariffs. There's also positive movement on resolving issues around rare earths and magnets. However, because the exact details of this agreement aren't public yet, market reactions have been fairly quiet. It's also worth noting that the EU expects these US-China talks to continue beyond their initial July 9th deadline. Keep an eye on how these negotiations develop, as they can certainly influence global markets.

• All Eyes on US Inflation Data (CPI):

Today at 1:30 PM BST, we're all waiting for the latest US inflation numbers (CPI). Experts are anticipating a slight increase in inflation. A stronger-than-expected number could boost the US Dollar, which might impact currencies like the British Pound (GBPUSD is currently at the lower end of its recent trading range). This data is crucial because it can give us clues about potential interest rate changes and overall economic health.

• UK's Spending Plans Unveiled:

Here in the UK, Chancellor Rachel Reeves is setting out the government's spending priorities for the coming years. She's expected to highlight significant investments in affordable housing and infrastructure over the next decade. While she won't be revealing how these plans will be fully funded today (that's for the Autumn Budget), she'll likely suggest that this increased spending will lead to economic growth, potentially reducing the need for higher taxes. Analysts don't anticipate a dramatic immediate market reaction to this review, as it's not a full budget, but the message she delivers could influence sentiment towards the Pound.

• Other Trade News:

Separately, the US and Mexico are nearing a deal to remove 50% tariffs on certain steel imports, another positive sign for trade relations.

In essence, while positive trade news is emerging, the lack of specific details means markets are still holding their breath. The upcoming US inflation data is the main event today, and the UK government's spending plans will paint a picture of future economic direction.

We'll keep you informed as more information becomes available.

11th June 2025

How We Can Help...

Our team are here to help you get more from your money when making international payments. We will work with you to understand your payment needs and offer guidance on the best options available to you.

Get in Touch!

P: 07441 910 897

E: FX-Admin@frank-exchange.com

This document has been prepared solely for information and is not intended as an Inducement concerning the purchase or sale of any financial instrument. By its nature market analysis represents the personal view of the author and no warranty can be, or is, offered as to the accuracy of any such analysis, or that predictions provided in any such analysis will prove to be correct. Should you rely on any analysis, information, or report provided as part of the Service it does so entirely at its own risk, and Frank eXchange Limited accepts no responsibility or liability for any loss or damage you may suffer as a result. Information and opinions have been obtained from sources believed to be reliable, but no representation is made as to their accuracy. No copy of this document can be taken without prior written permission.