Yesterday, GBPUSD remained stagnant ahead of the Fed meeting, which held rates steady as expected but failed to provide clear direction for the currency.
The Fed lowered its growth forecasts and raised inflation projections, reigniting concerns that interest rates may remain high for longer and sparking new recession fears.
In the eurozone, Germany’s approval of a major infrastructure fund is supporting the euro, which recovered after a brief dip.
*Daily move - against G10 rates at 7:30am, 20.03.25
** Indicative rates - interbank rates at 7:30am, 20.03.25
Today’s key event is the BoE interest rate decision, where no change is expected and the rate decision is expected to keep Sterling stable. Tomorrow’s UK retail sales data could affect GBP if the figures disappoint.
Eurozone consumer confidence is expected to be weaker, which could put pressure on the euro. The euro remains a safe haven, while the dollar’s direction is uncertain amid inflation and growth concerns.
In the US, Donald Trump’s tariffs and significant cuts to government spending are expected to impact the economy, with the Fed projecting GDP growth of 1.7% this year and an inflation rise of 2.7%. This marks a shift from December’s forecasts, which predicted 2.1% growth and lower inflation. Despite yesterday's small recovery, coupled with tariffs, this continues to weigh heavy on US equities and the dollar.
The US initial job claims report will be important for assessing market strength.
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.
