Currency news / March 25, 2025

Dollar demand continues

3 min read Thanim Islam

Thanim IslamMarch 25, 2025

Market snapshot:

PMIs for UK and US overshoot
Dollar demand continues going into quarter end

Yesterday's currency recap

Yesterday afternoon, demand for the dollar picked up after services PMIs came in much higher than expected. The manufacturing segment slipped back into contraction territory but the overall composite number was better than expected.

In the UK, we witnessed a parallel trend as market expectations for rate cuts eased by 3 basis points, while Europe's figures didn't quite meet the anticipated rise.

As a result, EURUSD slipped to a three-week low. Overall market sentiment was positive following on from the Trump administration's comments on the weekend that tariffs will likely be more targeted than previously threatened.

The Federal Reserve's (Fed) Bostic spoke in the evening as well, pushing back against markets pricing on rate cuts, suggesting he only sees one more rate cut his year as he doesn’t expect inflation to come down as quickly as he hoped.

Today's GBP rates

Currency pair	Daily move*	Indicative rate**
GBPAUD	-0.07%	2.0576
GBPCAD	-0.30%	1.8477
GBPCHF	-0.07%	1.1398
GBPDKK	0.07%	8.9181
GBPEUR	0.07%	1.1955
GBPJPY	0.70%	194.1760
GBPNOK	-0.28%	13.5817
GBPNZD	-0.28%	2.2588
GBPSEK	-0.39%	13.0488
GBPUSD	-0.12%	1.2903

*Daily move - against G10 rates at 7:30am, 25.03.25
** Indicative rates - interbank rates at 7:30am, 25.03.25

Key data points

Currency	Event	Period	Consensus	Previous
EUR	German IFO Business	Mar	86.80	85.20
EUR	German IFO Current Assessment	Mar	86.50	85.00
EUR	German Expectations	Mar	87.50	85.40

What we think

The euro is weaker to start the morning ahead of German IFO numbers at 9am. An upside surprise should ease some of these early losses.

Away from data, Ukrainian and US teams are set to be holding more talks in Saudi Arabia to discuss a 30-day energy and Black Sea ceasefire in the war with Russia.

Client appetite for dollars has increased over the last week in light of the dollar being at its weakest value since November.

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