20/01/2025
Written by: Ian Morley
Summary:
Labour is poised for a 170-seat majority, set to unseat the Conservative party in the General Election. The market reaction has been minimal, with GBP maintaining previous gains. Overall, markets were subdued yesterday, partly due to US Independence Day celebrations.
Speeches:
Market Insight:
With the UK elections concluded, focus now shifts to US employment data and the second round of the French election this weekend. In light of Fed Chair Powell’s recent comments, today’s figures will be crucial in predicting the timing of potential interest rate cuts by the Fed. Anticipation of slightly weaker numbers could increase the likelihood of a rate cut in September, potentially pushing GBPUSD towards this year’s highs.
French polling projections indicate that Marine Le Pen’s National Rally and its allies are unlikely to secure an absolute majority. This sentiment has been supporting the EUR, but the outcome remains a significant risk for GBPEUR and EURUSD over the weekend.
In the UK, attention returns to economic data and the timing of interest rate cuts by the Bank of England. The probability of a 0.25% rate cut in August stands at 65%, with the next key data release being the June CPI on 17th July.