Published: 01/05/2024 By ECAP
The British Pounds seems to have lost some momentum as the dovish stance of the Bank of England has limited further gains. In fact, BoE Governor Andrew Bailey is confident about cooling down inflation in the UK and sees market expectations for two or three rate cuts this year. On that note, investors have priced in the first rate cut from the BoE in August, with 50-basis points expected.The Euro continues to decline for the second consecutive day and remains relatively flat this morning as European markets are largely closed for Labour Day. Moreover, investor confidence remains strong regarding the European Central Bank potentially implementing interest rate cuts in June, as a majority of ECB policymakers have expressed support for such a move.
The U.S. Dollar came close to a six-month high against a basket of currencies as anticipation of today’s Federal Reserve meeting kept investors largely biased towards the greenback. For now, the Fed is expected to begin cutting interest rates only by September, if at all, this year. On that note, investors will pay close attention to Powell’s press conference for more cues on the path of rates.
Data supplied by GC Partners