EUR – Remains relatively stable but lacks strong upside catalysts. Limited Eurozone data has left the euro largely driven by external factors, while political developments in France remain a longer-term consideration.

GBP – Is showing signs of softness as renewed dollar strength and UK political uncertainty weigh on sterling. Markets remain focused on US monetary policy expectations, limiting the pound’s near-term momentum.

USD:

The dollar strengthened yesterday as heightened geopolitical tensions boosted safe-haven demand after the US struck Iranian targets following attacks on commercial shipping in the Strait of Hormuz. However, today’s focus is the FOMC meeting minutes. Markets will be looking for signs that the Federal Reserve remains hawkish, with any such signals likely to provide further support for the dollar.

EUR:

The euro slipped slightly yesterday but has recovered some ground this morning. With little Eurozone economic data, the currency is largely following broader dollar moves. Longer term, political developments in France could become a headwind if fiscal concerns return ahead of next year’s election.

GBP:

Sterling lost momentum yesterday as the stronger dollar weighed on the currency. Political headlines remain in focus following Nigel Farage’s announcement that he will resign as an MP to contest the resulting by-election, but near-term direction is likely to be driven by US monetary policy expectations rather than domestic factors.