After a rocky week for the pound, triggered in part by political uncertainty surrounding proposed welfare reform, GBP remains on the back foot as we head into a fresh set of economic events that could bring renewed volatility.
Attention turns back to trade deals this week as President Trump’s 90-day pause on reciprocal tariffs was due to expire on Wednesday, before announcing last night that the deadline had been extended to 1st August.
Though the UK has agreed arrangements for some industries including automotive and steel, that are several sectors that haven’t been included, leaving the pound exposed to volatility risks.
This week’s key insights:
- Monday – Eurozone retail sales:
This morning’s data could influence how the euro performs in the short term. A stronger-than-expected result may support EUR strength and add pressure to the GBP to EUR rate. - Wednesday – Federal Open Market Committee:
The Federal Open Market Committee (FOMC) is the US central bank’s key policy-setting group. Its meeting minutes are closely followed by markets as they reveal internal discussions around:
- Inflation risks
- Interest rate expectations
- The potential for future tightening or easing
Any signs of a more hawkish tone could strengthen the US dollar, which often drives broader currency market movements, including euro performance. In turn, this could have knock-on effects for GBP to EUR.
- Friday – Major UK Economic Data Dump:
Friday could be a pivotal day for Sterling. The UK will release:
- GDP growth figures – a direct indicator of economic health
- Industrial & Manufacturing Production – gauges sector strength
- Trade Balance data – shows whether the UK is exporting more or importing more
We could see significant market reaction if these numbers miss or exceed expectations.
If you’re planning a transfer this week, whether it’s a property payment, investment, or sending money to family speak to a Lumon currency specialist today. Call +44 (0)204 506 5672 to explore your options.
