FX Markets Show Risk-On Tone as Geopolitical Tensions Ease

Foreign exchange markets displayed a risk-on sentiment Monday as traders responded to easing geopolitical tensions and diplomatic progress. EUR/USD gained 0.15% to 1.0845, while GBP/USD advanced to 1.2765, reflecting reduced demand for safe-haven currencies. The Swiss franc weakened notably, with EUR/CHF rising 0.3% to 0.9580 as investors moved away from traditional safety plays. Sterling showed particular strength, with EUR/GBP declining to 0.8495, supported by expectations of continued Bank of England hawkishness. Market participants are giving peace initiatives a chance, reducing defensive positioning that had dominated recent sessions. This shift has seen commodity currencies like AUD and NZD also gain ground against the dollar. Technical analysis reveals key resistance levels being tested across major pairs, suggesting potential for extended moves if risk appetite persists through the week.