Published: 05/04/2024 By ECAP
The British Pound was on the defensive this morning amid surmounting Bank of England interest rate cut expectations. In fact, markets are now pricing in four BoE interest rate cuts this year, with the likelihood of a June rate cut now standing at 75%. As such, ramped up rate cut speculations continue to pressure GBP exchange rates amid a lack of notable UK data.The Euro edged higher yesterday following a better than expected finalised PMI. In fact, the Eurozone’s purchasing manager’s index printed at 51.5 in March, surpassing market expectations of 51.1 and rising from 50.2 in February. That said, European inflation came in softer than expected on Wednesday, reinforcing expectations for a European Central Bank rate cut in June – a narrative that continues to weigh on the bloc’s single currency.
The U.S. Dollar fell to a one-week low yesterday, handing back some of its recent gains amid uncertainty over the path of U.S. interest rates and ahead of the release of more labour market data. In fact, today’s Average Hourly Earnings and Nonfarm Payrolls are expected to be closely scrutinized by market participants for fresh insights on the Fed’s outlook on the interest rates.
Data supplied by GC Partners