The British pound and the euro declined sharply against the US dollar on Thursday, marking their weakest levels in several months. The dollar's strength is attributed to optimism surrounding the US economy, expectations of lower taxes and deregulation under a potential second Trump presidency, and fading confidence in the Federal Reserve's rate-cut predictions for 2025.
The British pound fell to an eight-month low against the U.S. dollar on Thursday, while the euro hit its weakest level since November 2022. Optimism around the U.S. economy and equities was in focus as markets reopened following disrupted trade over Christmas and the New Year. Interest rate expectations and the potential for lower taxes and the deregulation under Donald Trump have been pulling the dollar higher in recent months.The euro and British pound hit multi-month lows against the U.S.
dollar on Thursday, as the fresh trading year kicked off and investors geared up for the return of Donald Trump to the White House this month. The euro was 0.33% lower against the greenback at $1.032 shortly before 1 p.m. in London, hitting its weakest level since November 2022. Sterling dropped 0.78% to $1.242, an eight-month low.Optimism around the U.S. economy and equities was in focus as markets reopened following disrupted trade over Christmas and the New Year. 'Already growth has kept outpacing forecasts as consumers and companies have shrugged off the impact of high interest rates, with the unemployment rate remaining low,' Susannah Streeter, head of money and markets at Hargreaves Lansdown, said in a Thursday note. 'Investors are hopeful that a goldilocks scenario will be the story of 2025, amid promises of lower taxes and deregulation under a second Trump presidency.'threat of sweeping tariffsThose outlooks have significantly pulled on currency markets in recent months, with inflationary risks from Trump's tariff proposals expected to lead to'The greenback continues to find support from expectations of USD-bullish Trump policies and fading conviction around the Fed's rate-cut trajectory for 2025,' Mohamad Al-Saraf, FX and rates strategy associate at Danske Bank, said in a Thursday note. Key data ahead in assessing the robustness of the U.S
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