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The USD opened slightly stronger ahead of today’s ADP payroll report, with hopes that another solid jobs figure could give the greenback a short-term lift. Meanwhile, markets also remain cautious as President Trump confirmed tariffs will resume after July 9, emphasizing ongoing discussions with Japan but maintaining a positive outlook on potential progress with India.
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GBP
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GBP climbed to new heights against the USD during early trading hours, hitting levels not seen in three years. However, the rally lost steam as USD strength re-emerged, driven by robust US data and renewed fiscal optimism.
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USD
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The USD strengthened into the European close, buoyed by upbeat US data. ISM manufacturing rose to 49, topping the 48.8 forecast, while job openings surged to 7.77 million, well above the 7.3 million estimate. The USD gained further after the Senate approved Trump’s major tax and spending reform bill, boosting market confidence.
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EUR
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The EUR also reached fresh multi-year highs before retreating as sentiment shifted in favor of the USD. Inflation data out of the Euro area came in exactly as projected, with June’s consumer price index rising 2% on an annual basis. The figures supported the current market view that the European Central Bank may implement just one more 25-basis-point rate reduction before year-end.
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CHF
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The CHF remained firm, with USD/CHF trading around 0.79 and EUR/CHF slipping below 1.07, supported by continued safe-haven demand. Investors sought stability amid broader market caution, helping the CHF outperform peers. The Swiss National Bank, however, has maintained a dovish tone—signaling readiness to cut rates or intervene in FX markets if the currency strengthens too far.
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During the overnight session, President Trump reiterated his commitment to reinstating elevated tariffs by July 9 and cast doubt on progress with Japan, stating uncertainty around reaching a trade agreement. Despite the renewed trade tensions, overall market sentiment remains constructive, with risk appetite intact and a steady tone across major indices as the day kicks off.
The USD opened the session on firmer footing, supported by anticipation surrounding the upcoming ADP employment report. Should the data surpass expectations once again, it may provide additional short-term momentum for the USD.
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HOW WE CAN HELP
Our experienced currency team is here to ensure you make the most of your international transfers. By gaining a clear understanding of your goals, we offer personalised support and recommend the most suitable strategies to help you navigate the currency market with confidence. Get in touch with Osman Hanif today on +44 (0) 20 3371 9200 or email osman@magnafinancial.com
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