Market Report : 02.02.2024

Published: 02/02/2024 By ECAP

The British Pound was volatile after the Bank of England maintained interest rates at current levels while hinting ever so cautiously that the next move would be an interest rate cut. The Bank successfully sent the message that a lower interest rate future awaits while not letting market participants get ahead of themselves and stack up bets for an early move.

The Euro continues to nurse its recent losses even though the Eurozone Harmonized Index of Consumer Prices eased to 2.8% YoY in January from 2.9% in December. Moreover, the Core inflation dropped to 3.3% YoY in the same month from the previous reading of 3.4%. This has raised bets that the ECB will probably cut interest rates in April, contributing to the Euro's recent weakness.

The U.S. Dollar was headed for a negative week ahead of key U.S. nonfarm payrolls data, which is expected to provide more cues on the path of U.S. interest rates. The data comes just a few days after the Federal Reserve kept interest rates steady and shot down expectations for an interest rate cut in March.

Data supplied by GC Partners