USD gained across the day, following PMI numbers that showed better economic activity in both the services and manufacturing sectors. This caused treasury yields to rise and markets to revise rate cut pricing for this year, from 53bp worth of cuts down to 48bp.
EU PMIs also showed expansion in the manufacturing and services sector, which caused EUR gains initially but this did not last. UK PMIs came in better than expected but manufacturing remained in contraction territory.
*Daily move - against G10 rates at 7:00 am, 22.08.25
** Indicative rates - interbank rates at 7:00 am, 22.08.25
Today all eyes are on Fed Powell's speech at 4pm at Jackson Hole, where markets will be looking for clues about future Fed policy. Powell will likely tread a cautious, data-dependent path, signalling openness to rate cuts later this year without committing in September. He'll likely emphasise ongoing inflation risks and reiterate independence amidst political noise. GBPUSD and EURUSD currently sitting at support levels with markets poised for the potential for some hawkish noise from Powell.
Our team of currency experts 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 specialised guidance on the best options available to you. Over the last 19 years we’ve helped over a million customers and last year alone processed over £12bn. We’re tried and trusted, and we’re ready to help you.
Have a great day.
