Weekly Currency Round Up: Friday Update
Rainstone FX Ltd 30th October 2026
The final week of October delivered plenty for markets to digest. The UK Budget, a series of central bank decisions and fresh economic data from both sides of the Atlantic all helped shape currency markets heading into November.
Sterling emerged as one of the week's stronger performers, while the euro came under renewed pressure from a combination of ECB caution, ongoing concerns around France and uncertainty following Christine Lagarde's announcement that she will step down early from the ECB.
What moved the markets this week
GBP: Sterling emerged as one of the week's stronger currencies. UK markets took John Healey's first Budget largely in their stride. Investors appeared comfortable with the government's reduced fiscal buffer, and attention quickly returned to the Bank of England.
GBP/USD held firm despite stronger than expected US growth and inflation data, as investors continued to price in a Bank of England rate rise next week and the possibility of further tightening beyond that. GBP/USD rallied on Thursday, while GBP/EUR climbed to its strongest levels in around 17 months, finishing the week close to 1.20.
EUR: The euro had another difficult week. The ECB left rates unchanged as expected, but markets interpreted the tone as cautious. Investors were already looking ahead to a potential December move, but policymakers showed little urgency to commit.
France remained a concern throughout the week, and uncertainty increased after Christine Lagarde announced she would leave the ECB early in February 2027. EUR/GBP broke below recent lows, while EUR/USD spent much of the week struggling around the 1.12 level before ending the week on the back foot nearer to 1.1150.
USD: The Fed delivered a widely expected hold and US growth remained impressive, with GDP expanding by 3.4% and inflation remaining elevated. Under normal circumstances that might have pushed the dollar higher.
Instead, markets focused on what comes after December, scaling back expectations for a longer cycle of rate rises beyond that point. As a result, the dollar weakened against most major currencies into Friday despite the strength of the underlying US economy.
AUD and NZD: Australia and New Zealand delivered one of the week's biggest surprises. Australian inflation came in stronger than expected, increasing expectations of an RBA rate rise next week.
Meanwhile, the RBNZ unexpectedly left rates unchanged, creating renewed weakness in the New Zealand dollar. Markets quickly adjusted to the growing divergence between the Australian and New Zealand central banks.
What to expect next week
Attention now turns to the Bank of England on 5 November, where a rate rise is seen as highly likely. Markets will also continue to watch developments in France, commentary from the ECB following this week's meeting and whether dollar weakness can continue after investors scaled back expectations for further Fed tightening beyond December.
With the UK Budget now behind us, monetary policy moves back to centre stage.
Rainstone Insight
With the UK Budget, Fed and ECB all landing within a matter of days, it was always likely to be a busy week for markets. What stood out was that some of the biggest moves came from changing expectations rather than the decisions themselves.
Whether you are moving personal funds, purchasing property overseas or managing international business payments, having a plan before major market events remains one of the most effective ways to reduce uncertainty. Opportunities and risks often emerge quickly when market expectations change.
If you would like support with your international payments, get in touch with the Rainstone team. We are watching the markets closely, so you do not have to.
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