Gains across sterling and the euro remain fragile, even with de-escalation hopes and surging equity markets taking the shine off the dollar's safe-haven bid. The IMF's growth downgrades, to the UK in particular, have refocused attention on economic fundamentals. Meanwhile political pressure on Starmer adds a domestic headwind for sterling. A packed data week lies ahead. Read on to find out what it's impact could be.
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Current FX rates: 20 April 2026
| Currency pair | Rate |
|---|---|
| gbp usd | 1.3521 |
| eur usd | 1.1768 |
| gbp eur | 1.1490 |
Rates correct as of 12:50pm on Monday 20 April but may now have changed.
The Big 3
A deeper look at the performance of major currency pairs this week. Become a subscriber to receive the full reports.
Sterling rally stalls as IMF growth downgrade and political pressure weigh
GBP/USD surged early in the week following ceasefire-driven dollar weakness, but there’s been a slowdown since then. The IMF downgrading UK growth by 0.5% underlined the economy’s vulnerability to higher energy costs, while fresh questions over Starmer’s integrity added political pressure. The dollar’s safe-haven bid has softened as equity markets push higher, but Trump’s unpredictability means a re-escalation can’t be ruled out.
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Euro pushes higher as dollar weakens, but Lagarde signals patience
EUR/USD also benefited from the broader de-escalation theme last week. As for policy impact, Lagarde’s comments suggested the ECB is in no rush to act. They want to see more of the economic fallout before any adjustments, effectively shelving the rate hike that markets had been pricing for next week’s meeting. European PMI data on Thursday is the key scheduled release, while the usual pattern holds: progress on negotiations supports the euro, any re-escalation favours the dollar.
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GBP/EUR stuck in tight ranges as data dominates the week
GBP/EUR has been range-bound, with neither currency able to break away while markets await Middle East developments and next week’s central bank meetings. A heavy week of UK data lies ahead. CPI on Wednesday is forecast at 3.3%, though a higher print is more likely to fuel stagflation concerns than sterling bullishness. Political pressure on Starmer continues to act as a headwind and on the euro side, Lagarde’s wait-and-see stance keeps expectations skewed toward hikes later this year, making it hard to see sterling gaining ground from here.
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Looking forward
Key dates for your calendar.
- Monday: Canada reports CPI.
- Tuesday: US retail sales. UK unemployment data. ZEW Economic Sentiment in Germany. Senate Banking Committee confirmation hearing for Fed chair nominee Kevin Warsh.
- Wednesday: UK CPI. Japan Balance of Trade. ECB Lagarde speaks.
- Thursday: S&P Global Manufacturing PMI in Germany. UK Manufacturing and Services PMI. South Korea GDP.
- Friday: Japan CPI. US consumer sentiment index. UK retail sales. German business climate.
What we’re talking to our clients about
IFX Payments is service led. Here are some of the conversations we’re having:
- Strait of Hormuz and ceasefire updates
- Rising unemployment/labour market pressures
- Supply chain disruption and business confidence
The contents of this article do not constitute financial advice and are provided for general information purposes only. While the content is based on information believed to be accurate at the time of publication, no guarantee is provided.