Published: 05/12/2024 By ECAP
The British Pound has been supported by the Bank of England’s gradual approach to cutting interest rates. In fact, Governor Andrew Bailey confirmed expectations for four rate cuts in 2025, with the OECD agreeing that UK inflation will remain above target. Ultimately, the Pound's outlook remains favorable as UK interest rates stay higher than those in the Eurozone and the US.The Euro has shown resilience despite the political turmoil in France, where Prime Minister Barnier was ousted after failing to pass a key finance bill. The Euro’s value remained stable, with limited market reaction to the political events. However, ongoing uncertainty in France and a divided parliament hinder the Euro’s potential for strong gains. Ultimately, France’s debt is supported by the European Central Bank, reducing immediate crisis risks but limiting the Euro's upward momentum.
The U.S. Dollar strengthened during yesterday’s trading session, with the Dollar Index rising to 106.47. The greenback benefited from its safe-haven status amid political turmoil in Europe and South Korea, as well as ongoing global conflicts. In fact, analysts at ING highlighted the Dollar's appeal due to high rates and liquidity, making it an attractive option for holding cash amid global uncertainties.
Data supplied by GC Partners