Currency news / February 13, 2025

Russia/Ukraine ceasefire on the cards?

3 min read Thanim Islam

Thanim IslamFebruary 13, 2025

Market snapshot:

EUR gains as Trump has productive calls with Putin
UK GDP rises

Yesterday's currency recap

US CPI numbers for all came in higher than expected for January leading to a jump in treasury yields and markets now pricing in only one rate cut by the Federal Reserve (Fed) for this year. Initial market reaction was unsurprising with the USD gaining across the board. However, those gains retraced within a few hours, which was surprising. Is this the markets suggesting that they’ve exhausted fresh reasons to buy and hold USD?

Trump continues to stay in the headlines after he announced he spoke to Vladimir Putin yesterday and discussed the dollar, energy and Ukraine. Are we closer to some kind of ceasefire? Risk sentiment was buoyed by this headline in the afternoon.

Today's GBP rates

Currency pair	Daily move*	Indicative rate**
GBPAUD	0.14%	1.9799
GBPCAD	-0.07%	1.7777
GBPCHF	-0.08%	1.1361
GBPDKK	-0.30%	8.9312
GBPEUR	-0.30%	1.1974
GBPJPY	1.38%	192.3670
GBPNOK	0.50%	14.0024
GBPNZD	0.22%	2.2061
GBPSEK	0.15%	13.5364
GBPUSD	0.00%	1.2443

*Daily move - against G10rates at 7:30am, 13.02.25
** Indicative rates - interbank rates at 7:30am, 13.02.25

Key data points

Currency	Event	Period	Consensus	Previous
USD	CPI MoM	Jan	0.30%	0.20%
USD	CPI YoY	Jan	3.30%	3.30%
USD	Core CPI MoM	Jan	0.30%	0.00%
USD	Core CPI YoY	Jan	3.30%	3.50%

What we think

UK GDP this morning surprised to the upside! December growth came in at 0.4% versus the expected 0.1%, taking the Q4 GDP number to 0.1% versus the expected -0.1%. GBP moves have been muted, though, given the outperformance was helped by the services sector and had little to do with consumption and business, investment fell sharply. So, whilst the headline number reads well, the underlying fundamentals are likely to be a concern for markets.

Continuing from above, it's worth noting USD FX rates have been consolidating of late. Despite ongoing discussions about trade tariffs from Trump and the Fed's cautious stance on rate cuts, it seems the market might be on the hunt for more attractive entry points to invest in USD or seeking new catalysts to reignite interest in the currency, potentially signalling a pause in the Trump-trade narrative.

For now, it seems that markets are taking a break from the tariff headlines; and for today, at least, the prospects of a Russia/Ukraine ceasefire could lead to additional EUR gains. Higher risk sentiment, could lead to further USD declines.

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