06/12/2024
Written by: Ian Morley
Summary:
Yesterday’s BoE meeting highlighted a key sentiment that more officials might favour a rate cut. Consequently, market expectations for rate cuts in August and September increased from 50% to 65% and from 80% to 98%, respectively. This led to a general decline in GBP.
The CHF weakened significantly following a rate cut and lowered inflation forecasts, prompting broader inflows into USD. Currently, GBP/USD is at a one-month low.
Speeches:
Market Insight:
UK retail sales experienced an unexpected rise in May as the return of drier weather encouraged consumers back to the shops. Although GBP initially strengthened, the gains were short-lived due to the dovish tone from yesterday’s BoE meeting influencing GBP’s direction.
Throughout the day, attention will be on initial PMI estimates across Europe, the UK, and the US. So far, Europe’s figures have been below expectations, exerting early pressure on the EUR.