Key Headlines

•            Iran reports no casualties following Israel's missile strikes

•            Tensions highlight the lure of the dollar

Recap

Tensions in the Middle East rose last night as Israel launched a strike on Iran. Initial market reaction saw oil jump, equity futures drop, and save havens like CHF, JPY, and USD gain across the board. Iran’s media outlets are attempting to downplay the attacks, reporting that there are no casualties, and its nuclear sites are undamaged. Senior Iranian officials are also suggesting that there are no plans for any immediate retaliation. As a result of this, some of the initial panic in markets is fading, causing some of the initial USD gains to ease as well.

Fed commentary overnight also continued to suggest that the Fed are prepared to wait before electing to cut interest rates. Neel Kashkari suggested that rates may well stay on hold all year, and Fed Bostic reiterated his view it wouldn’t be appropriate to cut rates until the end of the year.

Today’s Overview

UK data this morning showed that retail sales stalled in March, and provides further evidence of a lacklustre recovering in the UK economy from its technical recession last year, as well as highlighting that the cost-of-living crisis is still lingering. Worth noting that GDP in February was marginally lower than January – from 0.2% to 0.1%. GBP is lower across the board as a result.

Tension in the Middle East seems likely to be the overriding factor in the markets, and Israel's attacks last night once again highlight the lure of USD as a safe haven. Add this to the outlook in US inflation & interest rates, and there seem to be plenty of arguments to suggest further gains on USD in the medium term.

Equals Market Analysis– 19^th April 2024

Today’s Rates

Today's Interbank Rates at 09:27 am against GBP movement.

GBP>EUR – 1.1685

GBP>USD – 1.2438

EUR>USD – 1.0645

GBP>CAD – 1.7117

GBP>AUD – 1.9387

GBP>SEK – 13.644

GBP>AED – 4.5683

GBP>HKD – 9.7410

GBP>ZAR – 23.941

GBP>CHF – 1.1294

GBP>PLN – 5.0664

Speeches

•          GBP: BoE Ramsden, Mann

•          EUR: ECB Nagel

•          USD: Fed Goolsbee

(https://frank-exchange.com/)

This document has been prepared solely for information and is not intended as an Inducement concerning the purchase or sale of any financial instrument. By its nature market analysis represents the personal view of the author and no warranty can be, or is, offered as to the accuracy of any such analysis, or that predictions provided in any such analysis will prove to be correct. Should you rely on any analysis, information, or report provided as part of the Service it does so entirely at its own risk, and Frank eXchange Limited accepts no responsibility or liability for any loss or damage you may suffer as a result. Information and opinions have been obtained from sources believed to be reliable, but no representation is made as to their accuracy. No copy of this document can be taken without prior written permission.