Meetings of ECB and BOE to Impact GBP, EUR, and USD in Forex Market
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Anticipated Rate Cut by BoE to Impact GBP, EUR, and USD in Forex Market
Published: December 18, 2025
Market Overview
The Bank of England (BoE) is expected to announce a 25 basis point interest rate cut today, reflecting weakening momentum in the UK labor market and lower-than-anticipated inflation figures. The Pound Sterling has come under pressure as market participants brace for this dovish shift, which could exacerbate its recent declines against major currencies. In the U.S., attention is also on the upcoming Consumer Price Index (CPI) data, set for release later today, which will provide crucial insights into inflation trends following a prolonged data gap.
Meanwhile, the European Central Bank (ECB) is poised to maintain its current monetary policy stance amid rising inflation concerns, with its decision being closely watched for any shifts in forward guidance. The Euro has shown resilience near recent highs, but market sentiment remains cautious ahead of the ECB’s announcement. Additionally, the Japanese Yen is expected to face volatility as speculation mounts regarding potential interest rate hikes by the Bank of Japan (BoJ) in the coming days, further influencing currency dynamics in the forex market.
Today’s Economic Events
**Analysis:**
1. **Affected Currencies:** The currencies most likely to be affected include the British Pound (GBP), Euro (EUR), and US Dollar (USD). The BoE’s interest rate decision could impact GBP pairs, while the ECB’s decisions will affect EUR pairs. The US economic indicators, particularly the CPI and jobless claims, will significantly influence USD pairs.
2. **Expected Volatility and Market Reactions:** The BoE’s anticipated rate cut from 4.00% to 3.75% could lead to a bearish sentiment for GBP, particularly against USD and EUR. Stronger-than-expected US CPI and jobless claims could bolster USD strength, leading to increased volatility in major pairs such as EUR/USD and GBP/USD. Conversely, if US inflation numbers disappoint, it may temper expectations for further rate hikes, leading to a softer USD.
3. **Key Numbers Traders Will Be Watching:** Traders will focus on the BoE’s interest rate decision, particularly if it
- 07:00 GBP: BoE Interest Rate Decision (Dec)
- 08:15 EUR: Deposit Facility Rate (Dec)
- 08:15 EUR: ECB Interest Rate Decision (Dec)
- 08:30 USD: Core CPI (MoM) (Nov)
- 08:30 USD: CPI (MoM) (Nov)
Major Currency Pairs Performance
| Currency Pair | Price | Daily % | Weekly % | Monthly % |
|---|---|---|---|---|
| EUR/USD | 1.17216 | -0.15% | -0.15% | +1.35% |
| USD/JPY | 155.93300 | +0.18% | +0.10% | +1.67% |
| GBP/USD | 1.33467 | -0.20% | -0.18% | +1.43% |
| USD/CHF | 0.79630 | +0.21% | +0.08% | -1.06% |
| AUD/USD | 0.66067 | +0.05% | -0.66% | +1.75% |
| USD/CAD | 1.37780 | -0.04% | +0.06% | -1.90% |
| NZD/USD | 0.57625 | -0.08% | -0.68% | +2.47% |
Performance Charts
Best Daily Performer
Technical Analysis: 1. The USD/CHF pair is currently experiencing a short-term uptrend, as indicated by the daily change, but its position in the lower quartile of the 20-day range and negative monthly performance suggests a longer-term bearish trend.
2. The key technical levels to watch are the 50-day and 200-day SMAs, with the price trading relatively closer to the 200-day SMA, suggesting a potential resistance level.
3. In the short term, the pair may continue its slight rebound due to its recent performance, but the long-term outlook remains bearish unless it can surpass the 200-day SMA level.
Worst Daily Performer
Technical Analysis: 1. The GBP/USD pair, despite being the worst performer today, is exhibiting an upward trend over the last month with a slight pullback in the last week.
2. The current price is well above the 50-day and 200-day SMAs, suggesting a bullish momentum, while the position in the 20-day range indicates it’s closer to overbought territory.
3. Short-term outlook remains cautiously bullish, although the recent pullback and the high position in the 20-day range could signal a potential upcoming correction or consolidation.
Normalized Performance – All Majors (3 Months)
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