The British Pound held firm early Friday after the Bank of England reduced interest rates by 25 basis points to 4.25%. The move was widely expected as the BoE looks to support growth while keeping inflation in check.
Governor Bailey struck a cautious tone, signalling any further easing would be gradual. Markets reacted calmly, with GBP/USD slipping only slightly as traders await further policy signals.
Today’s Currency Shifts
By 07:15 this morning:
- EUR/USD rose 0.15% to 1.1242
- GBP/USD dipped 0.02% to 1.3242
- AUD/USD gained 0.09%, while NZD/USD slipped 0.09%
- USD/JPY dropped 0.39% as yields edged lower
- USD/CHF and USD/CAD both eased slightly
What’s Driving the Market Today
UK Outlook
The BoE rate cut was supported by five of the nine Monetary Policy Committee members. Two called for a deeper cut, and two preferred to hold rates at 4.5%.
Governor Bailey’s remarks suggested a watchful approach to wage growth and core inflation, reinforcing a data-dependent stance.
North American Focus
Focus shifts to Canadian jobs data, with the latest employment report due at 12:30 UK time.
Markets will watch for signs of labour strength or softening, as USD/CAD trades near 1.3918.
Asia-Pacific
The New Zealand Dollar continues to underperform, down 0.70% on the week.
Meanwhile, the Japanese Yen strengthened slightly as bond yields retreated following US rate-driven moves.
Currency Watch – Key Moves Today
| Pair | Price | Daily Change |
|---|---|---|
| EUR/USD | 1.1242 | ▲ 0.15% |
| GBP/USD | 1.3242 | ▼ 0.02% |
| AUD/USD | 0.6406 | ▲ 0.09% |
| NZD/USD | 0.5897 | ▼ 0.09% |
| USD/JPY | 145.34 | ▼ 0.39% |
| USD/CHF | 0.8307 | ▼ 0.18% |
| USD/CAD | 1.3918 | ▼ 0.04% |
Looking Ahead
The BoE’s cautious tone leaves room for further cuts in the second half of 2025.
Traders will also keep an eye on upcoming US inflation data, which could trigger broader USD movement into next week.