The US dollar has strengthened against the euro, leaving the European currency at a five-week low.

The dollar has depreciated markedly during 2025, partly as a result of Donald Trump’s upending of the global trading system making US assets relatively less attractive. However, that trend has reversed in the last week.

The euro was down by 0.8% on Wednesday afternoon, as investors adjust to the expectation of higher US interest rates (which tend to result in currency appreciation).

Depop, the London-based secondhand clothing marketplace, is on track for $1bn of annual sales for the first time, its owner Etsy has said, after a 35% surge in sales to $250m in the three months to 30 June.

The company said growth was driven by a 54% jump in sales in the US as it signed up a record number of new shoppers.

Growth at the business reflects a surge in interest in ‘pre-loved’ clothing in recent years with rival Vinted reporting a 41% rise in sales to almost €813m for 2024 with profits almost tripling to €95.4m after the company stepped out of the red for the first time in 2023.

The strong sales at Depop were revealed as its parent group reported a near 5% drop in sales to $2.8bn in the quarter as it saw a decrease in active buyers at its main Etsy marketplace, which focuses on handmade and bespoke products. Net profits for the group dived $24m to £29m, largely because of a loss on exchange rates.

The company did not say if it had been affected by changes in the US tax regime under which imported items worth less than $800 being sent direct to consumers must now pay import tax.

Wall Street shares are pretty flat at the start of trading on Wednesday in New York.

Here are the opening snaps, via Reuters:

• S&P 500 UP 4.84 POINTS, OR 0.08%, AT 6,375.70

• NASDAQ UP 40.33 POINTS, OR 0.19%, AT 21,138.63

• DOW JONES UP 14.09 POINTS, OR 0.03%, AT 44,647.08

Donald Trump is exhibiting an… unorthodox approach to monetary policy.

In a post on Truth Social, the social network he owns, Trump argued that the Federal Reserve should cut interest rates because of faster-than-expected growth.

That is the exact opposite of how the vast majority of economists think about interest rate changes: they usually consider higher interest rates when economies grow faster, in order to prevent inflationary pressure building.

Trump posted:

2Q GDP JUST OUT: 3%, WAY BETTER THAN EXPECTED! “Too Late” MUST NOW LOWER THE RATE. No Inflation! Let people buy, and refinance, their homes!

It is not the first time a world leader has gone for unorthodox monetary policy theories: Turkey’s president, Recep Tayyip Erdogan, argued for a period that higher interest rates cause inflation. That theory did not gain much traction.

The US economy is still growing under Donald Trump’s presidency, but at a slower rate than last year under Joe Biden. Atakan Bakiskan, US economist at Berenberg, an investment bank, said:

Since the start of the year, US economic activity has expanded by 1.2% annualised, much slower than last year’s odds-defying first-half performance of 2.3% annualised. This softer growth path will likely persist – courtesy of slower immigration, trade wars and an uncertain macro environment.

But for future interest rate decisions the Federal Reserve is likely to deprioritise the GDP figures in favour of the jobs data due to be released on Friday. Bakiskan again:

Given the lag and the noisy signal it sends, GDP will remain in the backseat. The Fed will stay focused on what sits in the front seat - the holy grail nonfarm payroll data - to assess the health of the US economy. That has so far proved resilient so far and should remain so on Friday. With only a few hours left until the Fed decision, which is all but guaranteed to be a hold, today’s GDP report will not change the narrative of a slowing but not stalled US economy.

There are signs of weakness in the US economy below the surface of the faster-than-expected second-quarter growth, according to Thomas Ryan, a North America economist at Capital Economics, a consultancy.

He wrote:

The 3.0% annualised gain in second-quarter GDP overstates the economy’s underlying strength, as it was largely driven by a 30% slump in imports as pre-tariff stockpiling unwound. The more worrying development was that growth in sales to private domestic purchasers slowed to just 1.2%, its weakest since late 2022.

Net trade swung from a 4.6%-point drag on first-quarter GDP growth to providing a 5.0%-point boost last quarter, driven by a sharp drop in imports as firms shifted from front running tariffs to working through existing stockpiles.

Consumption growth did accelerate – albeit to a slower pace than previous years. Ryan said that the consumption growth “demonstrates that all the tariff uncertainty last quarter did not lead to consumers retrenching entirely”.

With consumption posting a moderate gain, private sales to domestic purchasers, often seen as the best indicator of underlying economic strength, rose by 1.2% despite the weakness in investment.

Stock market futures indicate that US share indices are likely to rise at the opening bell.

S&P 500 futures prices are up by 0.1%, while futures for the tech-focused Nasdaq are up 0.2%.

The US economic data will surely play into the Fed’s decision for later: even with trade distortions, they buttress the argument that the US economy does not need further support – whatever the thoughts of Donald Trump on the matter.

Neil Birrell, chief investment officer at Premier Miton Investors, a fund manager, said:

As expected, the US economy bounced back strongly in the second quarter, much more than expected, after contracting in the first quarter ahead of the imposition of tariffs. With inflation above target, tariffs about to kick in and the economy looking in reasonable shape, there is virtually no chance of the Fed acting on rates before September, no matter what the President would like them to do.

The US Federal Reserve is expected to leave interest rates unchanged in an announcement later today, despite an onslaught of attacks from the White House against the central bank.

The Fed’s federal open market committee (FOMC) has eight opportunities a year to change interest rates during its scheduled two-day meetings. While the FOMC decreased rates three times in the fall, bringing rates down a full percentage point, it left rates unchanged after its last four meetings. Interest rates currently sit at a range of 4.25% to 4.5%.

Trump is partly to blame for the pause in rate cuts. Fed officials say that the economy has become too unstable to change rates. The Fed has to strike a delicate balance between its “dual mandate”, keeping both unemployment and inflation low. Though the economy was strong at the beginning of the year, Trump’s long slate of tariffs have started to creep into prices, bringing inflation up from 2.3% in April to 2.7% in June.

On Wednesday, executives at the consumer goods giant Procter & Gamble said tariffs were “inherently inflationary” and that US consumers were “under some level of stress” and that the company, long a bellwether of consumer sentiment, was experiencing slowing sales in the US and Europe.

You can read the full report here:

There is a big caveat to the US economy’s fast headline growth: it is still being distorted by the big swings in American trade – exemplified by Donald Trump’s announcement a few minutes before to impose steep 25% tariffs on India.

Imports surged in the first quarter, and then fell sharply in the second quarter. And imports count against GDP (to avoid double counting between different countries – even if imports are useful to that country). The US Bureau of Economic Analysis said:

The increase in real GDP in the second quarter primarily reflected a decrease in imports, which are a subtraction in the calculation of GDP, and an increase in consumer spending.

The share price of BAE Systems, Britain’s dominant weapons maker, is down 3.6% today, despite upgrading its sales and profit forecasts for the year thanks to the huge increases in military spending planned by the UK and its allies.

BAE Systems will not be worrying hugely about the share price dip: its shares are still up by 52% during 2025.

BAE has benefited from government spending on the next-generation Tempest fighter jet, due to fly by 2030. The company has also said that it is close to securing further orders for the Typhoon fighter jets that it already builds.

On the Typhoon orders, Charles Woodburn, BAE’s chief executive, said:

There’s definitely interest. But it’s hard to put a timeframe on when those potential next buys might come through.

There is little sign of a slowdown in sales demand, and a threat to its work on the US-made F-35 fighter jet programme was lifted after activists failed in a challenge to UK involvement. The government successfully argued that exports took precedence over the need to comply with UK laws on arms export controls, or any UK obligation to prevent an alleged genocide in Israel.

Woodburn said it was a “strong operational and financial performance in the first half of the year, giving us the confidence to upgrade our guidance”.

Reuters reported that Woodburn declined to comment on whether BAE was in talks with Boeing and Sweden’s Saab about teaming up on a future replacement for Britain’s Hawk trainer jet, after an earlier report.

Adidas has had a knock-on effect across the trainers world: in the UK, FTSE 100 retailer JD Sports is down 2.5% today after the German shoemaker missed its sales estimates.

However, David Hughes, an analyst at Shore Capital, an investment bank, said JD Sports investors should take heart from the Adidas growth in revenues in the quarter – despite the hit from tariffs.

He wrote that lower levels of discounting and higher full-price sell-through by Adidas were “another sign of strength in the ath-leisure market”. He added:

The growth delivered in the first half gives us more confidence in the strength of the ath-leisure market and in JD’s prospects for a revenue turnaround.

Britain’s clean energy future risks creating “winners and losers” if lower-income households are not shielded from the costs added to energy bills to pay for it, the head of the energy regulator has said.

Jonathan Brearley, Ofgem’s chief executive, said a “systematic approach” to sharing the rising costs of the government’s green power ambitions was needed to avoid poorer households facing soaring monthly payments.

The regulator for Great Britain launched a root-and-branch review on Wednesday into how the costs of upgrading the energy networks can be recovered through home energy bills in a way that is fairer.

The review could include plans to cut standing charges for lower-income households while wealthier customers pay a higher cost for upgrading the energy system.

You can read the full report here:

The Eurozone economy has grown by 0.1% – marginally better than the expectation of zero growth from economists.

The reading was marginally better than expected in part thanks to faster-than-expected growth in France, the second-largest economy in the EU.

Still, it was a slowdown compared with the 0.6% growth in the first quarter. Some economists have put down that acceleration to companies trying to get ahead of US tariffs by making more products and racing to get exports into the country before the levies took effect.

Economists had expected a lull in demand in the spring during a payback period.

It is not just tariffs that are causing problems for Aston Martin Lagonda: the British manufacturer issued a profit warning on Wednesday blaming trade disruption, but also the slump in demand for luxury cars in China.

Adrian Hallmark, Aston Martin’s chief executive, said:

China is a big problem child – no question.

The market for luxury vehicles in China remains extremely subdued.

Chinese demand for luxury cars – and other luxury products such as watches, fine wine and clothing – has been hit by the long-running turmoil in the country’s property market, but also by a political turn away from symbols of excess in the nominally communist country.

Aston Martin had previously said it expected to generate an operating profit, but on Wednesday said that operating profits were only “expected to improve towards breakeven”.

The company said sales in China were broadly flat compared with last year, “reflecting a continued weak macroeconomic environment which is leading to supressed demand and [which] is expected to continue at least in the near-term”.

The first waves have hit Hawaii after a powerful magnitude 8.8 earthquake struck off Russia’s far eastern Kamchatka peninsula and triggered tsunami warnings across the Pacific.

You can follow updates on the tsunami warnings here:

The evacuations are of course affecting businesses in the affected areas, including in Japan. Reuters reported:

Automaker Nissan Motor suspended operations at certain domestic factories in Japan to ensure employee safety, Kyodo news agency reported. Three tsunami waves had been recorded in Japan, the largest of 1.3 metres, officials said. Japan’s Chief Cabinet Secretary Yoshimasa Hayashi said there were no injuries or damage reported so far, and no irregularities at any nuclear plants.

Porsche has been heavily hit by the US tariffs, but the German sportscar maker has not yet decided to shift production to America.

The carmaker’s chief financial officer, Jochen Breckner, has told reporters this morning that the company is are observing the tariff situation and how the market responds, but there is currently no US production planned, Reuters reported.

Breckner said the EU-US trade deal is good for planning security but burdens Porsche’s business model. Porsche does most of its production in Germany.

The FTSE 100 has dropped 0.5% in the opening trades on Wednesday.

Germany’s Dax is down 0.2%, while France’s Cac 40 has dropped 0.15%. The Europe-wide Stoxx 600 is down 0.2%.