 Sterling to leads declines among European currencies, with its selloff accelerating as US markets open. Downward revisions to December’s PMI manufacturing data reaffirm the grim economic outlook for both Eurozone and UK. While these revisions offered no new surprises, they underline the widespread challenges confronting major European economies. Weak growth remains a shared concern for Germany, France, and the UK, though additional political instability in Germany and France amplifies the uncertainty. The UK, meanwhile, is grappling with stagnation risks exacerbated by the impact of the latest budget measures. Compounding the region’s troubles are looming threats of a trade war with the US, which could materialize as early as January 20 when Donald Trump officially assumes the presidency. Proposals to impose tariffs on European goods could significantly disrupt already fragile economies and further dent business sentiment in the region. In currency markets, there is growing speculation about EUR/USD approaching parity as ECB continues its steady rate-cutting cycle of 25bps per meeting until reaching neutral range. However, the medium-term outlook for Euro is not entirely bleak. Political stabilization in Germany following upcoming elections could restore some investor confidence, offering a counterweight to bearish pressures. The broader market picture today shows Yen as the strongest performer, followed by the Australian Dollar and New Zealand Dollar. At the other end of the spectrum, Sterling holds the title of the weakest currency, trailed by Euro and Canadian Dollar, while Dollar and Swiss Franc are mixed in the middle..... | 
