Forex News
- The Pound Sterling trades mixed against its currency peers as its outlook remains uncertain amid firm BoE dovish bets.
- BoE’s Taylor said he expects inflation to return to the 2% target in the near term.
- Investors widely expect the Fed to cut interest rates on Wednesday.
The Pound Sterling (GBP) continues to trade in a tight range above 1.3300 against the US Dollar (USD) during the European session on Tuesday. The GBP/USD pair trades sideways as investors await the Federal Reserve’s (Fed) monetary policy announcement on Wednesday.
At the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades flat inside Monday’s trading range around 99.00.
The Fed is almost certain to cut interest rates by 25 basis points (bps) to 3.50%-3.75% amid a slowdown in the United States (US) labour demand. Assuming that the Fed will loosen monetary conditions, the major driver for the US Dollar will be the Fed’s monetary policy statement, the dot plot, and Chairman Jerome Powell’s press conference to get cues on the interest rate outlook.
It is likely that the Fed will perform a delicate balancing act as inflationary pressures have remained well above the 2% target, and the job market has slowed down, partly due to the growing acceptance of Artificial Intelligence (AI) across industries.
Investors will also focus on the Fed’s economic projections report to know where policymakers collectively see the Federal Fund Rates heading in the medium and longer term. The report will also include fresh estimates for inflation, growth, and the jobless rate.
Investors expect BoE to cut interest rates next week
- The Pound Sterling trades mixed against its major peers on Tuesday, facing pressure as traders remain increasingly confident that the Bank of England (BoE) will cut interest rates by 25 basis points (bps) to 3.75% at its monetary policy meeting next week.
- BoE dovish expectations have been prompted by weakening United Kingdom (UK) labor market conditions and a slowdown in inflation. The latest survey by accountants KPMG and the Recruitment and Employment Confederation showed on Monday that permanent job placements remained weak last month in the run-up to Chancellor of the Exchequer Rachel Reeves’ budget on November 26 amid fears of possible tax increases, Reuters reported.
- On Monday, BoE external member Alan Taylor stated that inflation could return to the 2% target in the near term as both wage and services inflation have slowed down recently. “We’ve got our foot on the brake a little bit still, but I see us achieving the inflation target, as we should, in the near term,” Taylor said.
- For more cues on the UK interest rate outlook, investors will focus on BoE Governor Andrew Bailey’s speech, which is scheduled for Wednesday. This week, investors will also focus on the Gross Domestic Product (GDP) data for October, which will be released on Friday.
- In Tuesday’s session, the GBP/USD pair will be influenced by the JOLTS Job Openings data for October, which will be published at 15:00 GMT. The data is expected to show that US employers posted 7.2 million fresh jobs in that period.
Pound Sterling Price Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.05% | -0.04% | 0.12% | -0.10% | -0.20% | -0.21% | -0.06% | |
| EUR | 0.05% | 0.01% | 0.16% | -0.04% | -0.15% | -0.16% | -0.00% | |
| GBP | 0.04% | -0.01% | 0.17% | -0.05% | -0.16% | -0.17% | -0.01% | |
| JPY | -0.12% | -0.16% | -0.17% | -0.22% | -0.32% | -0.35% | -0.18% | |
| CAD | 0.10% | 0.04% | 0.05% | 0.22% | -0.11% | -0.13% | 0.04% | |
| AUD | 0.20% | 0.15% | 0.16% | 0.32% | 0.11% | -0.01% | 0.14% | |
| NZD | 0.21% | 0.16% | 0.17% | 0.35% | 0.13% | 0.01% | 0.16% | |
| CHF | 0.06% | 0.00% | 0.01% | 0.18% | -0.04% | -0.14% | -0.16% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Technical Analysis: Pound Sterling wobbles above 1.3300
The Pound Sterling wobbles in a tight range above 1.3300 against the US Dollar on Tuesday. The pair holds above a rising 20-day Exponential Moving Average (EMA) at 1.3244, maintaining a positive near-term bias. The 20-day EMA has sloped higher in recent sessions, and dips remain shallow.
The 14-day Relative Strength Index (RSI) at around 61 reflects bullish momentum, hints at an uptrend in the near term as the oscillator is far from overbought levels.
Momentum remains supportive while price stays above the rising 20-day EMA. A daily close above the 50% Fibonacci retracement at 1.3402 would reinforce the bullish tone and open room towards the October 17 high of 1.3471. Conversely, failure to breach that barrier would keep the pair consolidating, with pullbacks leaning toward the 38.2% Fibonacci area around 1.3305.
Economic Indicator
JOLTS Job Openings
JOLTS Job Openings is a survey done by the US Bureau of Labor Statistics to help measure job vacancies. It collects data from employers including retailers, manufacturers and different offices each month.
Read more.Next release: Tue Dec 09, 2025 15:00
Frequency: Monthly
Consensus: 7.2M
Previous: 7.227M
Source: US Bureau of Labor Statistics
- USD/CAD remains below 1.3860, with two-month lows, at 1.3800 on sight.
- The Fed is widely expected to cut its benchmark interest rate on Wednesday.
- The BoC, on the contrary, will keep its monetary policy unchanged.
The US Dollar remains pinned near two-month lows at the 1.3800 area, with upside attempts so far limited to below 1.3860. The pair has lost about 2% since late November as investors began pricing in a Fed interest rate cut at this week's Federal Reserve meeting.
The focus today, however,i s on the Weekly US ADP Employment change and the release of delayed US JOLTS Job Openings data for September and October, which will frame Wednesday’s Fed Decision. The market consensus anticipates steady job openings, at 7.2 million in both months, slightly below the 7.22 million openings seen in August.
On Monday, US President Donald Trump threatened to impose higher tariffs on Canadian fertilisers, in an event announcing new aid for US farmers, although the impact on the Canadian Dollar was marginal.
The highlight of the week is Wednesday’s Federal Reserve monetary policy meeting. The Fed is widely expected to cut its benchmark interest rate by 25 basis points, although Chairman Powell might deliver a hawkish message, lifting the bar for further rate cuts. This view is keeping the US Dollar from falling further.
In Canada, the BoC is widely expected to keep its monetary policy unchanged on Wednesday. The bank cut rates by 25 basis points to the current 2.25% level in October and signalled the end of the rate cycle, and the strong Q3 Gross Domestic Product (GDP) figures have endorsed that view.
Central banks FAQs
Central Banks have a key mandate which is making sure that there is price stability in a country or region. Economies are constantly facing inflation or deflation when prices for certain goods and services are fluctuating. Constant rising prices for the same goods means inflation, constant lowered prices for the same goods means deflation. It is the task of the central bank to keep the demand in line by tweaking its policy rate. For the biggest central banks like the US Federal Reserve (Fed), the European Central Bank (ECB) or the Bank of England (BoE), the mandate is to keep inflation close to 2%.
A central bank has one important tool at its disposal to get inflation higher or lower, and that is by tweaking its benchmark policy rate, commonly known as interest rate. On pre-communicated moments, the central bank will issue a statement with its policy rate and provide additional reasoning on why it is either remaining or changing (cutting or hiking) it. Local banks will adjust their savings and lending rates accordingly, which in turn will make it either harder or easier for people to earn on their savings or for companies to take out loans and make investments in their businesses. When the central bank hikes interest rates substantially, this is called monetary tightening. When it is cutting its benchmark rate, it is called monetary easing.
A central bank is often politically independent. Members of the central bank policy board are passing through a series of panels and hearings before being appointed to a policy board seat. Each member in that board often has a certain conviction on how the central bank should control inflation and the subsequent monetary policy. Members that want a very loose monetary policy, with low rates and cheap lending, to boost the economy substantially while being content to see inflation slightly above 2%, are called ‘doves’. Members that rather want to see higher rates to reward savings and want to keep a lit on inflation at all time are called ‘hawks’ and will not rest until inflation is at or just below 2%.
Normally, there is a chairman or president who leads each meeting, needs to create a consensus between the hawks or doves and has his or her final say when it would come down to a vote split to avoid a 50-50 tie on whether the current policy should be adjusted. The chairman will deliver speeches which often can be followed live, where the current monetary stance and outlook is being communicated. A central bank will try to push forward its monetary policy without triggering violent swings in rates, equities, or its currency. All members of the central bank will channel their stance toward the markets in advance of a policy meeting event. A few days before a policy meeting takes place until the new policy has been communicated, members are forbidden to talk publicly. This is called the blackout period.
United States (US) President Donald Trump criticizes Federal Reserve (Fed) Chair Jerome Powell, in an interview with Politico during the European trading session on Tuesday, for not reducing interest rates, calling him "not a smart person". Trump also talked about the current status of truce discussions with Russia and Ukraine.
Additional remarks
Would make support for immediately slashing interest rates as a litmus test in the choice of a new Fed chair (well, duh).
Ukraine hasn't had an election in a long time.
No question Russia has a stronger position.
On Ukraine: Europe is not handling it well.
Europe nations are 'decaying, leaders are 'weak'.
Trump denies pledging a bailout for Hungary.
Trump may make tariff changes to lower some prices.
Trump declined to rule out troops in Venezuela.
Could extend anti-drug military operations to Mexico and Colombia.
Market reaction
US President Trump's comments seem ineffective on the US Dollar (USD). The US Dollar Index (DXY) remains steady around 99.00 as of writing.
US Dollar Price Today
The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.02% | -0.02% | 0.11% | -0.10% | -0.19% | -0.23% | -0.02% | |
| EUR | 0.02% | -0.00% | 0.13% | -0.07% | -0.16% | -0.18% | -0.00% | |
| GBP | 0.02% | 0.00% | 0.17% | -0.07% | -0.16% | -0.18% | 0.00% | |
| JPY | -0.11% | -0.13% | -0.17% | -0.22% | -0.31% | -0.34% | -0.15% | |
| CAD | 0.10% | 0.07% | 0.07% | 0.22% | -0.09% | -0.12% | 0.07% | |
| AUD | 0.19% | 0.16% | 0.16% | 0.31% | 0.09% | -0.02% | 0.16% | |
| NZD | 0.23% | 0.18% | 0.18% | 0.34% | 0.12% | 0.02% | 0.18% | |
| CHF | 0.02% | 0.00% | -0.00% | 0.15% | -0.07% | -0.16% | -0.18% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
- The Indian Rupee attracts bids against the US Dollar; however, its outlook remains uncertain.
- The amount of stake dumped by FIIs in the Indian stock market remained lower in the last two trading days.
- Investors expect the Fed to cut interest rates by 25 bps on Wednesday.
The Indian Rupee (INR) bounces back against the US Dollar (USD) on Tuesday. The USD/INR pair falls to near 90.15 amid a slowdown in the pace of foreign outflow from the Indian stock market.
Over the last two trading days, overseas investors have pared their stake by an average worth of Rs. 547.25 crore, which is lower than the average selling of Rs. 2,491.18 crore seen in the first four trading days this month.
Foreign Institutional Investors (FIIs) have relentlessly sold their stake in the Indian equity market in the second half of the year due to a delay in the announcement of a United States (US)-India trade deal. The US-India trade uncertainty has widened India’s fiscal deficit and strong demand for US Dollars in the non-deliverable forward (NDF) market.
However, the outlook for the Indian Rupee remains uncertain, as top negotiators from India and the US have not provided any hint of a timeframe for reaching a consensus.
On the domestic front, investors await the retail Consumer Price Index (CPI) data for November, which will be released on Friday. According to a December 4-8 Reuters poll, India’s retail inflation is expected to have grown at an annualized pace of 0.7%, faster than 0.25% in October.
In the Reserve Bank of India’s (RBI) monetary policy, announced on Friday, Governor Sanjay Malhotra revised inflation projections for the current year lower to 2.0% from 2.6% anticipated earlier.
The table below shows the percentage change of Indian Rupee (INR) against listed major currencies today. Indian Rupee was the strongest against the Japanese Yen.
| USD | EUR | GBP | JPY | CAD | AUD | INR | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.04% | -0.02% | 0.09% | -0.04% | -0.22% | -0.23% | -0.09% | |
| EUR | 0.04% | 0.02% | 0.13% | 0.00% | -0.18% | -0.21% | -0.07% | |
| GBP | 0.02% | -0.02% | 0.12% | -0.01% | -0.20% | -0.22% | -0.09% | |
| JPY | -0.09% | -0.13% | -0.12% | -0.13% | -0.31% | -0.34% | -0.20% | |
| CAD | 0.04% | -0.01% | 0.01% | 0.13% | -0.19% | -0.19% | -0.08% | |
| AUD | 0.22% | 0.18% | 0.20% | 0.31% | 0.19% | 0.02% | 0.12% | |
| INR | 0.23% | 0.21% | 0.22% | 0.34% | 0.19% | -0.02% | 0.14% | |
| CHF | 0.09% | 0.07% | 0.09% | 0.20% | 0.08% | -0.12% | -0.14% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Indian Rupee from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent INR (base)/USD (quote).
Daily digest market movers: US Dollar flattens ahead of US Job Openings data
- The Indian Rupee broadly underperforms the US Dollar, even as the latter trades cautiously ahead of the monetary policy announcement by the Federal Reserve (Fed) on Wednesday.
- At the press time, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades subduedly near 99.00.
- Investors are confident that the Fed will cut interest rates by 25 basis points (bps) to 3.50%-3.75% in the December policy meeting amid weakening job market conditions.
- In late November, New York Fed Bank President John Williams also warned of slower economic growth and weak labour demand, while supporting the need for more interest rate cuts.
- "Economic growth has slowed, and the labor market gradually cooled," Williams said, adding that there is room for a further adjustment in the near term.”
- With traders remaining confident that the Fed will cut interest rates on Wednesday, the major driver for the US Dollar will be the central bank’s guidance on the monetary policy outlook. Federal Open Market Committee (FOMC) members are expected to support holding interest rates steady in early 2026 as inflationary pressures have remained well above the 2% target for months.
- In Tuesday’s session, investors will focus on the US JOLTS Job Openings data, which will be published at 15:00 GMT. US employers are expected to have posted 7.2 million fresh jobs in October.
Technical Analysis: USD/INR's rally hits pause near 90.70
USD/INR trades at 90.3455 as of writing. The 20-day Exponential Moving Average (EMA) at 89.6159 rises, and the pair holds above it, keeping the bullish bias intact.
The 14-day Relative Strength Index (RSI) at 67.76 (bullish) has eased from overbought, indicating firm momentum that is no longer stretched.
Staying above the 20-day EMA would keep the path of least resistance to the upside, while a close below it would tilt risks toward a pullback. A push in RSI back above 70 would flag overbought conditions and could prompt consolidation. Initial support is at the 20-day EMA near 89.6159. On the upside, the pair could advance the uptrend to near 92.00 if it breaks above the all-time high near 90.70.
(The technical analysis of this story was written with the help of an AI tool)
Fed FAQs
Monetary policy in the US is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability and foster full employment. Its primary tool to achieve these goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, it raises interest rates, increasing borrowing costs throughout the economy. This results in a stronger US Dollar (USD) as it makes the US a more attractive place for international investors to park their money. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates to encourage borrowing, which weighs on the Greenback.
The Federal Reserve (Fed) holds eight policy meetings a year, where the Federal Open Market Committee (FOMC) assesses economic conditions and makes monetary policy decisions. The FOMC is attended by twelve Fed officials – the seven members of the Board of Governors, the president of the Federal Reserve Bank of New York, and four of the remaining eleven regional Reserve Bank presidents, who serve one-year terms on a rotating basis.
In extreme situations, the Federal Reserve may resort to a policy named Quantitative Easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used during crises or when inflation is extremely low. It was the Fed’s weapon of choice during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy high grade bonds from financial institutions. QE usually weakens the US Dollar.
Quantitative tightening (QT) is the reverse process of QE, whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing, to purchase new bonds. It is usually positive for the value of the US Dollar.
The Japanese Yen (JPY) is lagging as markets price in a 25bps BOJ hike on December 19, with Governor Ueda signaling moderate inflation risk but persistent upward wage pressures; USD/JPY may slide toward 140 following US-Japan yield differentials, BBH FX analysts report.
Governor Ueda highlights future wage pressures
"JPY is underperforming. Bank of Japan (BOJ) Governor Kazuo Ueda struck a balance tone in his latest interview. Ueda noted he does not see very high risk of too much inflation at present but cautioned that 'upward pressure on wages will continue in the future' due to a labor shortage."
"The swaps curve price in 90% odds of a 25bps BOJ rate hike to 0.75% on December 19. Tighter monetary policy paired with Japan’s government latest fiscal stimulus package is JPY positive. We see room for USD/JPY to adjust lower towards the level implied by US-Japan two-year bond yield spreads around 140.00."
The Reserve Bank of Australia (RBA) kept its cash rate steady at 3.60%, emphasizing an end to easing and hinting at the potential for a future hike, while AUD/USD rebounded toward 0.6650 with resistance near 0.6700 awaiting direction from tomorrow’s Fed decision, BBH FX analysts report.
Bullock rules out near-term cuts, eyes potential hike
"RBA delivers a hawkish hold. As was widely expected, the RBA Board voted unanimously to keep the policy rate unchanged at 3.60% for a third consecutive meeting. The RBA also stressed it’s done easing, warning “the risks to inflation have tilted to the upside” while dropping past reference to two-way uncertainty about the outlook."
"Importantly, RBA Governor Michele Bullock stressed 'I don’t think there are interest rate cuts in the horizon for the foreseeable future…The question is, is it just an extended hold from here or is it possibility of a rate rise. I couldn’t put a probability on those but I think they’re the two things that the board will be looking closely at coming into the new year'. RBA cash rate futures imply nearly a full 50bps rate increase to 4.10% over the next twelve months."
"AUD/USD initially slipped, then bounced back to recent highs near 0.6650, with limited follow-through given it’s already near the level implied by AU-US interest rate expectations. AUD/USD faces major resistance at 0.6700. Tomorrow’s Fed outcome will dictate whether AUD/USD clears it or stalls below it."
The US Dollar (USD) remains under pressure as Treasury yields ease and US equity futures tread water, with today’s ADP and October JOLTS reports providing a crucial read on labor demand ahead of the upcoming Fed meeting, BBH FX analysts report.
ADP jobs data and JOLTS report in focus
"USD is holding below its 200-day moving average, 10-year Treasury yields eased back a little after testing the top-end of its 3.95%-4.20% range in place since September, and US equity futures are treading water."
"The US ADP weekly employment preliminary estimate is due today . The last weekly report from November 25 showed that for the four weeks ending November 8 private employers shed an average of -13.5k jobs a week while the November ADP jobs print was -32k."
"The US October JOLTS report will be a bigger job check ahead of Fed showtime. Further declines in the hiring rate, quit rate and vacancy-to-unemployed ratio would add to signs of worsening labor demand. If so, the Fed funds futures curve will likely adjust lower against USD."
- EUR/JPY retreats slightly after reaching a multi-year peak at 182.15.
- The JPY remains under pressure due to the 7.6-magnitude earthquake and weaker Japanese data.
- Strong Eurozone indicators and expectations that the ECB has ended its rate-cut cycle support the Euro.
EUR/JPY trades below 182.00 on Tuesday after setting a new multi-year high at 182.15 earlier in the day, still posting a 0.25% gain at the time of writing. The move reflects a combination of support for the Euro (EUR) and weakness in the Japanese Yen (JPY) within a contrasting macroeconomic backdrop between the Eurozone and Japan.
The Euro benefits from a series of stronger-than-expected indicators. The Eurozone Sentix index improved markedly in December, with investor confidence rising to -6.2 from -7.4 in November, while the Expectations component strengthened to 4.8. At the same time, Germany recorded a rebound in Industrial Production of 1.8% in October, well above the consensus that had anticipated a contraction. These figures reinforce the view that the European economy is showing more resilience than previously thought.
Signals from the European Central Bank (ECB) also support the single currency. Executive Board member Isabel Schnabel said she felt comfortable with market expectations pointing to the next move being a rate hike, while Martins Kazaks noted that such a decision should not occur as early as December. This tone strengthens the perception that the ECB has ended its easing cycle, boosting the Euro against weaker currencies.
In contrast, the Japanese Yen remains under pressure. Japan released a revised Gross Domestic Product (GDP) figure for the third quarter at -0.6%, showing a deeper contraction than expected. This complicates the Bank of Japan’s (BoJ) normalization path. BoJ Governor Kazuo Ueda confirmed that the institution is moving slowly toward normalization, highlighting that inflationary pressures persist, yet investors remain cautious about the actual timing of policy tightening.
The situation has been worsened by a powerful 7.6-magnitude earthquake in the country’s northeast, leading to evacuation orders and tsunami warnings. The event increases concerns over short-term economic prospects, adding to Japanese Yen weakness.
EUR/JPY Technical Analysis
In the 4-hour chart, EUR/JPY trades at 181.71, up for the day by 24 pips. The 100-period Simple Moving Average (SMA) advances and sits near 180.77, with price holding above it. This keeps the near-term tone biased to the upside. The Relative Strength Index (RSI) stands at 64, signaling firm bullish momentum without overbought conditions. A descending trend line from 182.01 was broken at 181.24, enhancing the bullish impetus.
The rising trend line from 179.78 underpins the move, offering support near 180.18. Immediate resistance aligns at 182.01, while support is seen at 178.98. A clear break above resistance could open the way to fresh highs, whereas failure to hold trend-line support would expose the lower horizontal level.
(The technical analysis of this story was written with the help of an AI tool)
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