Market Report :07.02.2024

Published: 07/02/2024 By ECAP

The British Pound recovered ground against the Euro, Dollar and other major currencies following the sharp drops experienced on Monday. In fact, the British Pound remains fundamentally supported as markets faded expectations for the start time and degree of interest rate cuts to come from the Bank of England.

The Euro bounced of its recent lows against the U.S. Dollar yesterday as European economic data came in better than expected. However, the data still broadly exposed a weakened domestic European economy, and momentum remains limited. Looking forward, market players will watch today’s Industrial Production data as well as tomorrow’s Economic Bulletin release.

The U.S. Dollar seems to be consolidating its recent gains as the expectation of interest rate cuts from the Fed has waned. In fact, markets are now pricing in a 15% possibility of rate cuts in March and 50% odds of rate cuts in the May meeting. This, in turn, lifts the US Dollar and acts as a tailwind for the greenback.

Data supplied by GC Partners