Awaiting Data
GBP: The British Pound has lost some of its recent gains as expectations further increase of interest rate cuts. Unemployment has risen to 5.1% which shows Britian’s labour market continues to deteriorate. To counter this deterioration, cutting interest rates are a natural response to stimulate the labour market and wider economy. However, markets still await the inflation data which will help to truly determine the efficacy of an interest rate cut. Overall, the British Pound has fallen due to the unemployment data, but markets still await inflation data.
EUR: The Euro has continued to remain stable and, in many cases, outperforming peers. Markets are currently not anticipating any further ECB rate cuts although they await explicit confirmation from the ECB that their rate cutting cycle has ended. However, many in the market are awaiting the PMI data being released today to determine direction and some are looking to the meeting of EU leaders as a test for wider EU effectiveness. Overall, the Euro has continued to remain stable with many in the market awaiting data being released today to see if this continues.
USD: The US Dollar stumbled at the start of the week caused by a rise in global risk appetite and an increase in the likelihood of Federal Reserve interest rate cuts. Markets await US Job data being released and non-farm payrolls figures for October and November. These data releases could lead to markets expecting further interest rate cuts if there is labour market weakness. Overall, the US Dollar has continued its fall caused by the Federal Reserve with many in the market awaiting labour market data today to see if this trend will continue.
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