Spectrum Daily Report

GBP: The British Pound faced pressure as UK labour market data showed average weekly earnings grew by 5.9% in January 2025, reinforcing inflationary pressures. While this reduced today’s likelihood of a rate cut by the Bank of England, unemployment rose to 4.4%, potentially supporting arguments for easing. Ultimately, stability in job vacancies and upcoming tax increases may limit aggressive rate cuts, influencing the Pound’s outlook.

EUR: The Euro fell against most currencies yesterday, despite its safe-haven status. Looking forward, the bloc’s single currency may be influenced by upcoming speeches from ECB officials, with any dovish comments potentially weakening the currency further in the following trading sessions. Ultimately, market sentiment remains sensitive to ECB signals, and any indications of a more dovish stance could add pressure on the Euro.

USD: The U.S. Dollar weakened as the Federal Reserve held rates steady but projected at least 50-basis points of cuts this year, despite inflation concerns and a reduced growth outlook for 2025. In fact, the dollar index fell, extending overnight losses, as investors reacted to the Fed's cautious stance and growing uncertainties around trade tariffs. Ultimately, this continued pressure kept the greenback near five-month lows.

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