Market Report : 01.02.2024

Published: 01/02/2024 By ECAP

The British Pound remains confined within a tight trading range as market participants await the Bank of England interest rate decision later in the day. Although it is widely anticipated to keep its monetary status quo, investors will monitor the policy outlook and language for hints about future rate cuts.

The Euro lost ground across the board yesterday after market participants pivoted back into a cautious stance. The move comes as German Retail Sales backslid, followed by German CPI inflation easing faster than expected, helping bolster investor sentiment that the European Central Bank would achieve a faster pace of rate cuts.

The U.S. Dollar hovered near a seven-week high after the Federal Reserve kept interest rates steady and shot down expectations for a March rate cut. In fact, Fed Chair Jerome Powell said that recent stickiness in inflation will keep the central bank from carrying out any monetary loosening in the near-term. Ultimately, his comments saw investors begin pricing in the possibility that the central bank will start cutting rates from May 2024.

Data supplied by GC Partners