Key Headlines:

• Continued Pressure on GBP: Analysts expect further losses for the British Pound this week.
• Spotlight on Trump's Executive Orders: The market's attention remains fixed on recent executive actions from Donald Trump.

Recap

The British Pound extended its losses during Friday's trading, weighed down by disappointing retail sales data that highlighted a weak conclusion to 2024 for the UK economy. This fuelled speculation of three potential rate cuts by the Bank of England in the year ahead. Beyond the GBP's decline, market activity was relatively subdued as investors awaited the inauguration of President Trump, which is expected to influence market sentiment moving forward.

Today’s Rates

Today's Interbank Rates at 10:40 am against GBP movement.

GBP>EUR – 1.1814

GBP>USD – 1.2190

EUR>GBP – 0.8463

EUR>USD – 1.0315

GBP>CAD – 1.7635

GBP>AUD – 1.9654

GBP>SEK – 13.595

GBP>AED – 4.4759

GBP>HKD – 9.4880

GBP>ZAR – 22.872

GBP>CHF – 1.1131

GBP>PLN – 5.0272

Today’s Key Takeaways

UK Economic Data Under the Spotlight:

• Tuesday: Job numbers, including wage growth and unemployment rate, will offer insights into inflationary pressures and overall economic health.
• Friday: PMI data will provide another measure of economic performance. Poor results may amplify GBP weakness.

Market Sentiment and Rate Cut Speculation:

• Concerns about the UK economy continue to grow, with markets pricing in the possibility of three rate cuts by the Bank of England this year, driven by slowing inflation and broader economic risks.

EU and US PMI Data:

• PMI figures, due Friday, will be key indicators of January's economic activity across the EU and US.

Focus on Trump's Presidency:

• Financial markets are closely monitoring Trump's initial days in office, with expectations of executive orders on immigration and trade. Anticipated policy moves could drive significant USD volatility.

20th January 2025

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