What geopolitical developments influenced currency markets?

Investors were closely monitoring the prospect of talks between the U.S. and Russia aimed at ending the war in Ukraine, which boosted the euro amid optimism surrounding these potential discussions.

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Trump's Fed Nominee Stokes Dovish Expectations, Pressuring Dollar

Q: How did the Bank of England's rate cut affect the British pound?

The pound hovered near a two-week high, clinging to sharp gains from the previous day, as the Bank of England cut interest rates but only after a narrow 5-4 vote, indicating the central bank's easing bias lacked conviction.

8 Aug

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Summary

Trump's Fed nominee fuels expectations of dovish Powell replacement
Sterling holds gains after divided BoE rate cut
Euro rises amid optimism over potential U.S.-Russia talks

Trump's Fed Nominee Stokes Dovish Expectations, Pressuring Dollar

As of August 8th, 2025, the dollar was under pressure and on course for a weekly fall. This was largely due to U.S. President Donald Trump's temporary choice for a fill-in Federal Reserve Governor, which stoked expectations for a dovish pick to replace Chair Jerome Powell when his term ends.

Meanwhile, the British pound hovered near a two-week high, clinging to sharp gains from the previous day. This came as the Bank of England cut interest rates, but only after a narrow 5-4 vote, indicating the central bank's easing bias lacked conviction.

Elsewhere, the euro gained ground amid optimism surrounding potential talks between the U.S. and Russia aimed at ending the war in Ukraine. Investors were closely monitoring these geopolitical developments and their influence on currency markets.

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