As global markets continue to recalibrate in 2025, European forex traders are navigating a dramatically reshaped landscape. Central banks are diverging on policy, safe-haven demand is resurging, and global capital flows are shifting. In this evolving environment, a few high-volume, high-volatility currency pairs are emerging as top trading opportunities across the continent.
EUR
The euro is slowly regaining some lost ground. As the most recent IMF COFER released, the share of the euro in global foreign exchange reserves rose to 20.1% in Q1 2025, increasing from 19.8% in the previous quarter. This is the highest level in more than two years, while the share of U.S dollars fell to 57.7%, which is the lowest value since 1995.
According to TradingPedia, this shift reflects a broader trend of diversification among central banks.
Sources: Reuters IMF
As of July 14, 2025, EUR/USD has been trading at approximately 1.1689, which is within its 52-week range of 1.01 to 1.18. This puts the pair firmly in the upper end of its yearly bound and shows that the bullish momentum is still fully maintained. The reallocation toward the euro has helped revive interest in the EUR/USD pair, which is the most traded currency pair globally. According to the Bank for International Settlements (BIS) Triennial Survey, the euro accounted for 31% of all FX trades in April 2022, while the US dollar was used in 88% of all FX trades. However, these percentages indicate the participation of the euro and dollar in trades and not the ownership share of the EUR/USD pair.
Sources: Reuters Market, East&Partners
CHF
By 2025, the Swiss franc (CHF) had reclaimed its status as a safe-haven currency. As reported by IMF COFER, the franc’s share of global reserves rose notably to 0.8% in Q1 2025, which was a fourfold increase and the highest it has been since 1999.
In mid-2025, the USD/CHF exchange rate fell to about 0.796–0.813, a 15-year low. This drop was driven by a broader risk-off sentiment globally and safe-haven demand for the Swiss currency. As a result, the Swiss National Bank (SNB) cut its benchmark interest rate to 0% on June 19, 2025. This was the sixth consecutive rate cut since March 2024 and was targeted at curbing franc strength.
Sources: Reuters IMF, Reuters Swiss
GBP
According to the Reuters/LSEG market data, GBP/USD is trading close to 1.34 as of July 15, 2025, which is the upper bound of its 52-week range of 1.21–1.38.
This is supported by the BoE’s decision to keep rates at 4.25% during their June 19 meeting, which took place with a rather divided 6-3 vote in favor of the decision. The Bank of England is slowly navigating weakening growth alongside sticky inflation. Lombardelli, the deputy governor of the BoE, noted that services inflation is “sticky” even with decelerating wage growth.
Sticky inflation, tempered growth, and caution from the Bank of England have pushed GBP/USD into “yield play” territory. Since the last rate decision, markets have increased odds of a first rate cut to August, but subsequent cuts are expected to be even more gradual.
Sources Reuters BoE, Reuters Rates, Reuters UK
As we approach mid-2025, the outlook for forex traders in Europe becomes more complex. Goldman Sachs has predicted that the euro will continue to be supported for the next several quarters, given that the ECB’s “shallow” rate cuts and growth in the euro area is stabilizing. In the bank’s revised 12-month EUR/USD forecast, now set to 1.15, there is less pressure on the currency to dip. On the contrary, GBP is set to underperform further as the economy is burdened by slower growth and the BOE nears its easing phase.
Late 2024 bearish momentum on EUR/USD has been reversed, leading to a strong rally through early 2025. Last January, support was found at 1.0500 where the 23.6% Fibonacci retracement level of the 2021-2022 move was, and multiple tests formed an ascending triangle which decisively broke out in March, driven by rising U.S. recession fears. This breakout brought EUR/USD above 1.1500 in May, triggering overbought RSI conditions for the first time since 2020 both on the weekly and daily charts. Although price action has slowed since then, EUR/USD remains bullish. The pair is hovering near key Fibonacci resistance levels (76.4% and 78.6%), where short-term consolidations have occurred.
Sources: Forex, Goldman Sachs
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