Dollar retreats after last weeks advance
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Daily Currency Update
The US dollar has given back some of the substantial gains it made last week as the first full working week of 2025 gets underway. Last week, EUR/USD hit 1.0221, its lowest level since November 2022. The decline in EUR/USD was likely due to a combination of factors, including stronger-than-expected US PMI data, rising wholesale gas prices in Europe driven by cold weather, and growing concerns over the impending Trump administration. The President-elect's proposed import tariffs have unsettled global politicians, contributing to the euro's sharp decline since the election.This morning, the dollar has retreated slightly, with EUR/USD recovering to around 1.0330 and GBP/USD rebounding to approximately 1.2460 after hitting an eight-month low of 1.2352.
Key Movers
This week’s focus is on US economic data, culminating in Friday’s monthly jobs report, which is expected to show that 154,000 jobs were added in December. Ahead of this, the ISM Services PMI will be released tomorrow. Wednesday brings private sector employment data, weekly unemployment claims, and the minutes from the Federal Reserve's most recent meeting.Donald Trump’s inauguration is set for January 20th, and as has been the case since his election win in November, any statements regarding future trade policy are expected to significantly influence market movements.
Expected Ranges
- GBP/USD: 1.2390 - 1.2540 ▲
- GBP/EUR: 1.2010 - 1.2105 ▲
- GBP/AUD: 1.9915 - 2.0065 ▲
- EUR/USD: 1.0255 - 1.0375 ▲