Market Update 5th September – 9th September

Where you will be able to keep up to date with all the latest changes in the currency market


We`ve seen continued GBP weakness against most major currencies over the last week as world events continue to cause increased uncertainty across the globe. Despite this, the main focus today will be the result of the Conservative Leadership Contest with the result due today.  We have been expecting this to have a large effect on the strength of GBP today as well as any corresponding news about the emergency measures being brought in to help with the cost of living crisis. We also have a report due on Wednesday outlining the Bank of England’s monetary policy hearings which will give a clearer idea of the level of inflation that is expected in the coming months and what further steps may be necessary to stop continued rises in inflation levels.


Last week we saw the Euro weaken by about 2% against the US Dollar, although we did see some gains against GBP. This was due to mixture of gas supplies being cut off to Europe as well as CPI and retail sales data that came out last week. This Wednesday we have GDP figures coming out from the Eurostat and depending on how the figures come out we could expect to see big swings either way. Thursday may be even more crucial to the future strength of the Euro however as we see an ECB Monetary Policy decision statement, outlining how they expect to proceed in the coming months to tackle inflation.  


We have continued to see further USD strength as the conflict in Ukraine continues. The Dollar is trading at the highest level against the Pound since 1985. With Putin announcing Friday that Nord Stream 1 will once again pause supply of gas to Europe, we could see further US Dollar strength until it is resolved. This could potentially cause some more US Dollar strength as it is seen as a safe haven currency in times of uncertainty. If the war was to end anytime soon which seems unlikely, then we could see some dollar weakness. This week we have a speech coming out from Jerome Powell which we will be monitoring for further indication of US Monetary Polocy as well as employment figures on Thursday where, depending on how they come out we could see some large volatility.