ChamberFX Valuable Insights

These valuable insights are provided by Damon Ellam, International Payments UK, MoneyCorp. Damon is our regional representative and will be providing useful monthly FX forecasts to help chamber members with their currency strategies.

Good Afternoon,

October was a bad month for GBP with a 1.8% loss versus EUR and 3.2% loss versus USD. The move lower has mainly been driven by concerns over the upcoming Autumn Budget, as well as expectations from some that the Bank of England will cut interest rates more in 2026 – this may now be possible as UK CPI inflation figures have surprised to the downside and productivity & growth forecasts are expected to be downgraded by the OBR.

As a result, November is a pivotal month for the fortunes of the pound, with the Bank of England meeting this week on Thursday 6^th and the Autumn Budget on Wednesday 26^th, including the release of the OBR forecasts. The UK CPI inflation release on Wednesday 19^th will also be closely watched.

If you want our in-depth analysis on the Autumn Budget and the potential FX market reaction then you can read our Autumn Budget 2025 whitepaper here.

Meanwhile, the ongoing US government shutdown has significantly reduced the flow of economic data from the US. So far, this hasn’t dented the dollar’s strength – in fact, USD has strengthened across the board over the past month. However, if the shutdown persists, it could begin to undermine confidence in the US economy and weigh on the dollar.

In summary, the UK is in the spotlight this month and the downside risks to the pound persist. I remain cautiously optimistic that the current gloom is temporary. Looking ahead to 2026, we could see more favourable economic tailwinds, which may support a recovery for the pound, however there’s likely some pain to endure in the meantime.

Please do let me know if I can help further with FX risk-management strategies for the weeks & months ahead.

Thanks

Damon

November Newsletter

Contact

For further information and advice on Hull & Humber's ChamberFX, or for assistance with your currency strategy, please click here or contact Lorraine Holt at l.holt@hull-humber-chamber.co.uk or call 01482 324976.

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