Market Report : 17.07.2024

Published: 17/07/2024 By ECAP

The British Pound mustered some strength this morning as the UK’s Office for National Statistics has reported stubborn inflation data for June. The CPI report showed that annual headline and core inflation rose steadily to 2.0% and 3.5%, respectively. Ultimately, BoE officials will likely hesitate to support the unwinding of the restrictive monetary policy stance due to sticky price pressures – further boosting the British Pound.

The Euro was relatively flat against its peers as market participants braced for tomorrow’s ECB meeting. The European Central Bank is broadly expected to keep rates on hold as policymakers wait to see if data will improve following an initial quarter-point cut in June. Nevertheless, markets still anticipate two additional cuts by the end of the year

The U.S. Dollar had initially taken some support from increased speculation over a Trump presidency, which could be positive for the currency in the long term. However, growing bets on interest rate cuts largely offset this notion, with investors pricing in an over 90% chance the Fed will cut rates by 25-basis points in September, according to the CME Fedwatch.

Data supplied by GC Partners