Home Daily Commentaries USD gains begin to retract

USD gains begin to retract

Daily Currency Update

US job openings declined sharply in December to 7.6 million. This was below the forecast of 8.01 million and previous 8.16 million, and the lowest reading since September 2024. Hiring, voluntary quits and layoffs remained steady, the Labour Department report showed on Tuesday. The report comes just a few days ahead of the nonfarm payroll count for January, which is expected to show 169,000 additional jobs, with the unemployment rate holding at 4.1%. Fed officials will be monitoring this data with caution for the future path of monetary policy.

Key Movers

Volatility in the foreign exchange markets has eased a little after a turbulent start to the week following US President Donald Trump's tariffs on top US trading partners, with those on Mexico and Canada having since been delayed following negotiations. The focus has since shifted to the tariffs imposed on China, which saw a quick response from Beijing with its own tariffs on imports such as American cars, farm equipment and energy shipments. It is hoped a deal can be struck before 10th January, when China's tariffs would kick in, to avoid a trade war.

There are also concerns after comments made by Donald Trump, speaking at a press conference about the Israel-Hamas conflict, that the United States are to take over the Gaza Strip and develop in economically given the sensitive nature of the issue in the Middle East.

GBP/USD has continued its recovery from its wall at the start of this week. Sterling now sits back above 1.2500 after touching 1.2280 on Monday. EUR/USD has followed the same pattern as GBP/USD, peering back over 1.0400 at the time of writing. However, these gains could be short lived with tariffs pending on the EU. GBP/EUR remains about 1.2000

Expected Ranges

  • GBP/USD: 1.2410 - 1.2570 ▲
  • GBP/EUR: 1.1980 - 1.2060 ▲
  • GBP/AUD: 1.9820 - 1.9990 ▲
  • EUR/USD: 1.0240 - 1.0490 ▲

Written by

Alex Hartley

OFXpert

Driven by a passion for currency markets and data movement, Alex finds great appeal in the dynamic nature of the industry. With over 20 years of experience, Alex works closely with businesses to understand their foreign exchange requirements and align them with solutions. Placing a strong emphasis on customer service, he takes pride in nurturing long-lasting relationships with clients.