Published: 28/11/2023 By ECAPThe British Pound reached new multi-week peaks against the Dollar and Euro after the BoE’s Governor ratcheted up his campaign against expectations for interest rate cuts, warning that rates would not be cut "in the foreseeable future". Ultimately, the British Pound could extend gains over the coming weeks if market participants continue to buy Bailey's message and reduce bets for the scale of cuts in the coming 12 months.
The Euro got a slight boost yesterday after Lagarde’s hawkish words during her address at the European Parliament. In fact, the President of the European Central Bank cautioned that headline inflation could experience a slight increase in the near future. Ultimately, this narrative has helped the single currency maintain its ground.
The U.S. Dollar fell slightly in Asian trade, extending overnight losses after sinking to three-month lows at the start of the week. In fact, the greenback was walloped by growing bets that the Fed will raise interest rates no more and is likely to begin trimming rates in 2024. However, markets are now awaiting more economic cues to gauge just when the Fed could begin loosening policy.
Data supplied by GC Partners