EURUSD & GBPUSD Slide on Trump Tensions
Last week’s market action showed that geopolitical tensions and key economic data continue to shape major currency pairs. Traders are keeping a close eye on the US Dollar’s strength and the upcoming CPI readings, while technical levels hint at potential opportunities. Read on to discover what’s driving EURUSD and GBPUSD this week and where the market could be headed next.
EURUSD Falls on Geopolitical Risks and ECB Rate Cut Bets
EURUSD closed last week’s trading session lower amid rising geopolitical tensions between the US and Venezuela. President Trump’s new war stance spread some fear and uncertainty across neighboring Latin American countries. As a result, investors’ capital flowed into the safe-haven US Dollar, boosting demand and pushing the pair down. The softer-than-expected European CPI data also acted as a catalyst behind last week’s downside move. A lower CPI reading is thought to increase pressure on the ECB to cut interest rates earlier.
Looking ahead to this week, traders and investors will mainly focus on geopolitical developments in Latin America, as well as ongoing tensions related to Trump’s Greenland stance. Deteriorating relations with neighboring Latin American The deteriorated relation with neighboring Latin American countries may continue to support the US Dollar demand, keeping the pair under pressure. The US CPI is expected to be the main catalyst driving price action this week.
Key Economic Data and Technical Levels for EURUSD
On the economic calendar, Tuesday features the US CPI, expected to rise by 0.3%. On Wednesday, the US Producer Price Index is expected to come in at 2.6%, while retail sales are forecasted at 0.4%.
From a technical perspective, the pair remains positive after last week’s close above 38.2% at 1.1632. Traders’ short positions are targeting profits at 1.1500, while new long positions are expected around 1.1591.
Position sentiment: BUY 40% – SELL 60%.
欧元兑美元 chart, January 11th, 2026. Source: TenTrade.com
GBPUSD Weakness Driven by US Dollar Demand
GBPUSD closed last week’s trading session lower, pressured by rising geopolitical tensions between the US and Venezuela. President Trump’s new war stance, increased fear and uncertainty across neighboring Latin American countries, driving investors towards the safe-haven US Dollar and pushing the pair lower. However, softer-then-expected US non-farm payrolls helped the pair stabilise, preventing a deeper downside move.
This week, market participants will focus on geopolitical developments in Latin America, along with Trump’s ongoing focus on Greenland. Continued deterioration in relations with neighboring Latin American countries may further support the US Dollar, keeping downside pressure on the pair. The US CPI is expected to be what traders and investors will focus on this week as it is thought to be the factor that may be behind the pair’s price action.
Key Economic Data and Technical Levels for GBPUSD
On the economic calendar, Tuesday brings the UK ILO unemployment rate, expected to remain steady at 5.1%, alongside the US CPI at 0.3%. On Wednesday, the US PPI is expected to come in at 2.6% and retail sales at 0.4%. On Thursday, the UK GDP is expected at 0%, while manufacturing production is forecast at 0.5%.
Technically, the pair remains positive after last week’s close above the 38.2% at 1.3400.
Position sentiment: BUY 30% – SELL 70%.
英镑兑美元 chart, January 10th, 2026. Source: TenTrade.com
Key Takeaways
Geopolitical tensions in Latin America are supporting US Dollar demand.
Softer-than-expected European and US data are influencing EURUSD and GBPUSD movements.
EURUSD remains under pressure, with ECB rate cut expectations weighing on the Euro.
GBPUSD shows downside risk, but technical levels suggest potential stabilisation.
US CPI and other economic releases will likely drive price action this week.
For more detailed economic calendar events please visit our live economic calendar on:
https://tentrade.com/economic-calendar/
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