Published: 21/11/2024 By ECAP
The British Pound edged lower against the U.S. Dollar, despite stronger-than-expected UK inflation data for October. Consumer prices rose 2.3% year-on-year, up from 1.7% in September. This increase, driven by higher household energy bills, raised doubts about a December rate cut by the Bank of England, as inflationary pressures, including higher taxes, are expected to persist into 2025.The Euro struggled against the U.S. Dollar, remaining weak after a bearish session. Investors are awaiting U.S. economic data, while comments from the European Central Bank about shifting risks to growth and inflation have dampened investor sentiment towards the Euro. Ultimately, the outlook remains uncertain, with analysts predicting limited movement within a narrow range.
The U.S. Dollar rose 0.3% yesterday, driven by its safe-haven status after the U.S. closed its embassy in Kyiv amid escalating tensions with Russia. This geopolitical uncertainty increased demand for the Dollar. Additionally, expectations for less aggressive Fed rate cuts supported the dollar's strength, with investors now lowering expectations for a December rate cut to 58.9%, down from 82.5% a week ago.
Data supplied by GC Partners