Market Report : 22.02.2024

Published: 22/02/2024 By ECAP

The British Pound steadied yesterday, shrugging off Britain's highest ever monthly budget surplus in January ahead of finance minister Jeremy Hunt's annual budget in March. However, the record surplus was still lower than expected and it does not mean the UK economy is out of the woods and generating cash significantly faster than before.

The Euro was relatively flat this morning as investors await the preliminary services and manufacturing purchasing managers’ index numbers from the eurozone in February due later in the session. These will serve as a gauge of business activity in the region, as investors look for clues of when the European Central Bank will start its rate-cutting cycle in an attempt to support the region’s struggling economies.

The U.S. Dollar stemmed recent losses as a slew of signals from the Federal Reserve showed that the central bank was likely to keep interest rates high in the near-term. In fact, the minutes of the Fed’s late-January meeting showed that the bank was in no hurry to reduce interest rates in the near-term. Moreover, several Fed officials this week also reiterated this hawkish stance, with policymakers citing concerns over sticky inflation.

Data supplied by GC Partners