That doesn’t necessarily mean the broader trend has changed. The US economy remains relatively resilient and markets are not aggressively pricing Fed rate cuts. However, after such a strong run, the dollar appears to be entering a period of consolidation. Unless fresh data significantly surprises to the upside, investors may be less inclined to chase the greenback higher in the near term.

EUR: The euro remains trapped in consolidation mode.

UOB notes that EUR/USD continues to trade within a defined range, with neither bulls nor bears showing enough conviction to force a breakout. The softer dollar has provided some relief, but the euro still lacks a strong domestic catalyst to drive a more meaningful recovery.

Against sterling, EUR/GBP is attempting to climb back towards 0.8400 after recently slipping into oversold territory. While that may support short-term rebounds, broader sentiment towards the euro remains cautious, particularly while economic growth across the Eurozone remains subdued.

GBP: Sterling continues to be the standout performer among the major currencies.

GBP/USD is holding close to monthly highs around 1.3410, supported by the weaker dollar environment and the market’s growing confidence that UK interest rates may remain elevated for longer than previously expected.

What’s particularly impressive is that the pound is finding support without a major domestic catalyst this morning. That suggests recent positioning and sentiment have become increasingly constructive towards sterling. While the pair may face resistance at higher levels, the fact that it continues to hold near its recent highs points to underlying demand for the currency.