26/07/2024
Written by: Ian Morley
Summary:
GBP appreciated amid a generally higher risk appetite in the markets. Money markets slightly reduced the likelihood of a rate cut in June by 5bps, alleviating some pressure on the GBP. Trading against the USD was relatively stable, with treasury yields slightly higher.
Speeches:
Market Insight:
A quiet day is anticipated with only the Canadian CPI numbers expected in the afternoon, alongside several speeches from Fed officials and BoE Bailey. Client attention remains focused on the UK CPI figures due tomorrow morning, which could influence the likelihood of a BoE rate cut in June rather than August. The steady increase in GBP ahead of the numbers suggests that the services CPI may not decline as much as expected, considering the significant price spikes in April 2022 and 2023. As highlighted in yesterday’s report, the main focus will be on the services and core components to determine the GBP’s direction leading up to June’s CPI release and the BoE meeting.