Market Report : 28.08.2024

Published: 28/08/2024 By ECAP

The British Pound ticked broadly higher through yesterday’s session, with investors seemingly unfazed by Prime Minister Kier Starmer’s warning that the government’s Autumn Budget will be ‘painful’. This upside in Sterling appeared to be supported by recent comments from BoE Governor Andrew Bailey, which have further eased interest rate cut expectations. While UK data remains in short supply the pound may maintain a positive trajectory so long as investors continue to reprice their rate cut bets.

The Euro was subdued during yesterday’s trading session following the publication of Germany’s finalised GDP reading for the second quarter of the year, alongside Germany’s latest GFK consumer confidence index. The lacklustre reading, although expected, has re-ignited fears over the overall health of the Eurozone’s largest economy, which has seen EUR exchange rates remain largely muted in the wake of the release.

The U.S. Dollar edged higher yesterday as heightened geopolitical tensions in the Middle East, Libya and Ukraine drove some safe haven demand for the greenback.  However, these gains were limited as investors focus on imminent U.S. rate cuts, particularly after Federal Reserve Chair Jerome Powell signalled the likelihood of such a move in his Jackson Hole speech last Friday.

Data supplied by GC Partners