The first trading week of 2025 has seen more US Dollar strength after a volatile start to the week. On Monday we saw markets react to speculation that Trump wouldn't be as aggressive with his pending trade tariffs which had sent Sterling back above 1.25.
Only for Trump to come out and knock this down, which saw The Dollar recover the initial losses suffered. Yesterday we saw Services PMI for The U.S highlighting that prices paid by businesses have reached their highest levels since February 2023 and therefore bringing an increase in inflationary pressures. All of this has further cemented the 'higher for longer' stance for The Federal Reserve with their Interest Rates moving into 2025. Non-Manufacturing PMI data also soared to 54.1, notably up from 52.1 in December as well as beating initial expectations for this yesterday's release.
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