EUR/GBP Loses Momentum, Awaits BoE Interest Rate Decision

The EUR/GBP declined to near 0.8405 following the release of UK Consumer Price Index Inflation data. UK CPI inflation remains above the Bank of England’s 2% target, with annual inflation at 2.2% in August, aligning with market expectations. Hotter-than-expected core CPI, which excludes volatile food and energy items, rose to 3.6% year-on-year in August from 3.3% in July, exceeding forecasts. In the Eurozone, the Harmonised Index of Consumer Prices dropped to 2.2% YoY in August, its lowest level in three years, though it remains above the ECB's 2% target. The BoE's upcoming monetary policy meeting could heavily influence market sentiment for the EUR/GBP pair.

EUR/USD Muted After Fed's Significant Rate Cut

The EUR/USD pair held steady at around 1.1120, following the Federal Reserve's substantial 50 basis point (bps) rate cut. On Wednesday, the Federal Open Market Committee (FOMC) eased monetary policy with its first such cut in four years. Eurozone HICP rose 2.2% YoY in August, in line with expectations and unchanged from the previous reading. Core HICP inflation held steady at 2.8% YoY in August, matching forecasts. Market focus now turns to an upcoming speech by ECB Executive Board Member Isabel Schnabel, alongside US economic data including Weekly Initial Jobless Claims, the Philly Fed Manufacturing Index, and Existing Home Sales data, which are expected to influence the EUR/USD pair in coming sessions.

GBP/USD Holds Steady Ahead of BoE Interest Rate Decision

The GBP/USD pair reached a fresh 30-month high, trading at 1.3300. The Federal Reserve's decision to begin its policy-easing cycle with a 50 bps rate cut introduced volatility into the currency pair. However, market expectations that the Bank of England's rate-cutting cycle will be slower than other central banks are helping to limit losses. Investors are now focused on today's BoE policy meeting, while US Initial Jobless Claims data for the week ending 13th September could further influence GBP/USD movements.

USD/CAD Rises Post-Fed Rate Decision

The USD/CAD pair fluctuated following the Fed's interest rate cut, driven by market volatility. The Fed's first rate cut in over four years and updated economic forecasts by FOMC officials weakened the dollar, leading to increased sales. On the Canadian front, rising crude oil prices and consumer inflation figures have fuelled speculation for a larger interest rate cut by the Bank of Canada, boosting the commodity-linked Canadian dollar. Market participants will closely watch US data releases, including Weekly Initial Jobless Claims, the Philly Fed Manufacturing Index, and Existing Home Sales, which could further influence USD/CAD price dynamics.

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