Category Archives: FX News

The latest Nationwide House Price Index reveals a 0.7% increase in UK house prices for December, significantly exceeding the forecasted 0.1%. For the year 2024, UK house prices rose by an impressive 4.7% year-on-year, reflecting renewed strength in the housing market.

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Key Drivers Behind the Surge

Several factors contributed to this unexpected jump in house prices:

• A marginal drop in the headline interest rate.
• Improved buyer sentiment, fuelled by slowing inflation.

This combination has bolstered demand, driving price growth even as economic uncertainties persist.

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Euro Under Pressure as ECB Outlook Weakens

The euro remains under pressure against both the pound and the dollar as the new year begins. Market sentiment reflects expectations of an ECB interest rate cut later this month, further weighing on the euro’s performance in currency markets.

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GBP/USD Hits 9-Month Low

As the Bank of England signals a potentially more aggressive approach to interest rate cuts compared to the Federal Reserve, the GBP/USD currency pair is trading at a 9-month low. This divergence in monetary policy outlooks is creating headwinds for the pound, underscoring the challenges ahead for sterling in 2025.

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How Could This Impact Your Business?

With fluctuating house prices and diverging monetary policies, businesses need to stay informed and agile. Whether you’re managing currency exposure or navigating the real estate market, preparation is key.

Contact Qumoney’s experts today to explore strategies for capitalising on market opportunities and protecting your financial position as we head into 2025.

With the New Year holiday limiting economic data releases, market movements are expected to remain flat, and volatility is likely to be modest. However, ongoing developments in the eurozone, UK, and US are keeping investors on alert.

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Euro Declines as Interest Rate Concerns Mount

The euro weakened on Friday against major rivals, marking its fourth consecutive weekly decline. This drop follows concerns over a widening US-eurozone interest rate differential, compounded by cautious remarks from ECB President Christine Lagarde.

Lagarde’s comments have increased the probability of a 0.25% ECB rate hike in January, rising from 55% to 65%, signalling a more cautious approach to monetary policy in the eurozone.

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Pound Under Pressure Against the Dollar

The GBP/USD currency pair continues to struggle amid:

• Flat UK GDP growth in Q3.
• Mixed retail sales data.
• Rising public sector borrowing.

These factors, coupled with a strong US dollar, have placed the pound under sustained negative pressure. Without significant changes in economic data or market sentiment, this trend is expected to persist.

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Key Takeaway for Businesses

With the euro’s decline and the pound facing headwinds, businesses involved in international trade should stay vigilant. Modest volatility may still present opportunities to hedge currency risks or lock in favourable rates.

Speak to Qumoney’s experts today to explore strategies tailored to your needs, ensuring your business is prepared as markets evolve into 2025.

With the Christmas period upon us, this week’s economic calendar is light, leading to flat market movements and subdued volatility. However, last week’s developments in monetary policy and currency trends still present key opportunities for businesses and investors.

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Pound Recovers After BoE Decision

Last week, the Bank of England’s monetary policy decision created initial headwinds for the pound. A split in the Monetary Policy Committee (MPC)—with 3 out of 9 members voting to cut interest rates—increased expectations of a potential rate cut at the next meeting.

Despite this, the lack of significant economic data this week has allowed the pound to regain ground against both the euro and the dollar, providing a favourable window for businesses to capitalise on its strength.

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Why Now is a Great Time to Hedge

The pound’s recovery offers a timely opportunity for forward buying. By locking in a competitive rate now, businesses can:

• Protect themselves from adverse market movements as we approach 2025.
• Secure their financial position amid ongoing uncertainties.

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Take Action Before Christmas

With markets stabilising in the lead-up to the holiday season, now is the time to consider your currency strategy for the new year.

Contact Qumoney’s experts today to discuss forward buying and hedging opportunities. Protect your business from volatility and secure peace of mind as we head into 2025.

Today’s economic updates reveal challenging conditions for the UK economy, as retail sales and currency movements highlight the impact of ongoing uncertainties. Here’s a closer look at the latest developments.

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UK Retail Sales: A Decline in Consumer Spending

This morning’s release of the UK’s Retail Sales data showed a month-on-month decline of 0.3%, a stark drop from the 0.5% growth recorded last month. The slowdown reflects mounting pressure on the retail sector, with consumer spending hampered by economic uncertainties.

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Pound Weakens After Interest Rate Decision

The pound has faced significant pressure following yesterday’s Bank of England interest rate decision. The main driver behind its decline was the unexpected split in the Monetary Policy Committee (MPC), where three members voted to cut rates.

This divergence has amplified concerns about the UK’s economic outlook and added volatility to the currency markets:

• Against the dollar, the pound has fallen over 100 points, with the dollar’s strength underpinned by robust US economic performance.
• Against the euro, sterling has shown relative resilience, as ongoing Eurozone struggles weigh on the euro.

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Uncertainty Over 2025 Monetary Policy

The Bank of England’s indication of four rate cuts in 2025 has been met with scepticism. Labour’s recent budget, expected to fuel higher inflation, casts doubt on the feasibility of such projections. This uncertainty has left markets in a state of flux, awaiting clearer signals on future monetary policy.

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US Data in Focus

Later today, the US will release its Personal Income data, with core price growth forecasted at 0.2%, slightly down from last month’s 0.3%. This release could shape market sentiment and influence further currency movements, particularly for the dollar.

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How Could This Impact Your Business?

The combination of weaker UK retail sales, volatile exchange rates, and shifting monetary policies highlights the importance of staying agile in uncertain markets. For businesses with international exposure, understanding these dynamics is critical to managing risks and capitalising on opportunities.

Speak to Qumoney’s experts today for bespoke strategies to navigate currency fluctuations and protect your bottom line.