Market Report : 24.06.2024

Published: 24/06/2024 By ECAP

The British Pound has been consolidating its recent moves following last week’s dovish Bank of England meeting. In fact, the BoE’s policy update revealed the central bank is readying for an August rate cut. However, as markets are only 65% priced for such an outcome, there is further room for a hike to be fully priced. As this occurs, the Pound could lose some recently gained value.

The Euro continues to be undermined by uncertainties about the outcome of a snap election in France, which has been fuelling concerns that a new government will worsen the fiscal situation in the Eurozone's second-largest economy. Moreover, the flash PMIs released on Friday indicated that the growth of business activity in the Eurozone slowed sharply in June, further weighing on the bloc’s single currency.

The U.S. Dollar opened the week on the front foot, trading near its highest levels since early May. In fact, the greenback was boosted by stronger than expected PMI readings, which sparked concerns that a resilient U.S. economy would give the Fed more headroom to keep rates high. Focus is now on key PCE data, due this Friday. The reading is the Fed’s preferred inflation gauge and is likely to factor into the outlook for interest rates.

Data supplied by GC Partners