Sterling recovers ground after punishing day yesterday

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waterman
Written by Dan Waterman
April 10th 2025
It appears President Trump does care what financial markets think after all..

The financial market turmoil, collapse or whatever you want to call it has finally caught the attention of the US President. It took for the most intense market volatility seen since the Covid pandemic for a change of plan

Trillions of Dollars have been erased from global stock markets recently, but it was yesterday's unsettling government bond yields that looked to trigger a Trump response with him saying "I thought people were jumping a bit out of line", shortly after announcing the 90-day tariff pause.

Financial markets returned from the brink following the news, but are not out of the woods by any means just yet. Uncertainty very much remains and everyone involved in financial markets are all doing the same thing; taking it one day at a time

In terms of the currency market and in particular GBP, here is what has happened this week;

The safe-havens (JPY & CHF) gave back half of their gains, but are still well up across the board by at least 2% this week (they are moving in the same way major stocks are which is normal). The USD rallied back from 6-month lows against most currencies out there. 

And as I have been mentioning, what isn't normal is seeing the king of the market (USD) half behaving like a safe-haven and half being devalued itself. £-$ started the week on the back-foot, losing 3% versus last week, before collapsing a further 2% yesterday (which has now been claimed back).

It was only 10-days ago that GBP v USD was trading at a 6-month high..

£-€ has been behaving very erratically of late, following its own trend, the petulant child of the market. Yesterday, the Euro blew away the Pound as UK government bond yields went mad.

Extraordinary, GBP v EUR fell to a (albeit brief) 15-month low yesterday..

This comes after being on a wild downward trend for nearly 2-weeks now. The pair surprisingly trades at the worst time since August last year, after enjoying a rather consistently great 6-month period of trading.