Published: 18/07/2024 By ECAP
The British Pound was relatively flat this morning following the release of mixed UK employment data. However, UK employment rose 19K in the three months to May which resulted in an unchanged unemployment rate of 4.0%, which was expected. Ultimately, the message from the labour market is clear: the labour market is still tight, and wages are too high for the Bank of England to hit its 2.0% target sustainably.The Euro was on the back foot this morning as investors shifted their focus on today’s ECB meeting. The European Central Bank is expected to maintain its main refinancing rate at 4.25%. Moreover, ECB President Christine Lagarde is unlikely to outline a specific path for rate cuts. Instead, Lagarde is expected to highlight the need for more data to ensure confidence in the disinflation process before considering further policy easing.
The U.S. Dollar rose slightly in Asian trade, after tumbling this week as investors priced in a greater chance that the Fed will cut rates by at least 25-basis points in September. For now, recent dovish comments from Fed officials are likely to exert further selling pressure on the greenback. Looking elsewhere, the weekly Initial Jobless Claims and Philly Fed Manufacturing Index will be released later today.
Data supplied by GC Partners