Published: 12/06/2024 By ECAP
The British Pound was broadly unaffected by the UK’s monthly GDP and Industrial Production data for April. The UK economy failed to grow as a mild expansion in the services sector was offset by a decline in Industrial Production and construction output. Weak data suggests that households and businesses struggle to bear the burden of high interest rates by the BoE. This could force the central bank to start easing its monetary policy sooner.The Euro extended its recent losses and fell a third of a percent as turbulent EU Parliamentary elections destabilized European markets. In fact, the elections, which concluded over the weekend, saw sharp moves to the right in a number of countries, most prominently in France. This prompted French president Emmanuel Macron to call a shock snap legislative election, a move which amounts to a roll of the dice on his political future.
The U.S. Dollar steadied near one-month highs as investors hunkered down before a barrage of cues on U.S. interest rates from the Federal Reserve and key inflation data. The Fed is widely expected to keep rates unchanged this evening. Moreover, before the Fed’s decision, CPI data for May is due later in the session. The reading is also expected to show inflation remained sticky in May, giving the Fed little impetus to begin trimming rates.
Data supplied by GC Partners