Wednesday 18/12/2024
Daily Update 18/12/2024
Key Headlines:
- UK Inflation Update: Inflation figures met expectations, keeping the focus on the BoE's next steps amid ongoing economic concerns.
- Fed Rate Decision: The Federal Reserve is widely anticipated to cut interest rates by 25bps, with markets watching closely for any shifts in forward guidance.
Recap
GBP retained its upward trajectory following the release of stronger wage growth figures, which pushed gilt yields higher. Market expectations for Bank of England rate cuts in 2025 have softened, with current pricing indicating just two 25bps reductions throughout the year.
Today’s Rates
Today's Interbank Rates at 09:39 am against GBP movement.
GBP>EUR – 1.2088
GBP>USD – 1.2688
EUR>GBP – 0.8269
EUR>USD – 1.0492
GBP>CAD – 1.8179
GBP>AUD – 2.0109
GBP>SEK – 13.906
GBP>AED – 4.6591
GBP>HKD – 9.8620
GBP>ZAR – 22.937
GBP>CHF – 1.1340
GBP>PLN – 5.1528
Today’s Key Takeaways
- UK CPI figures matched expectations this morning, resulting in minimal impact on GBP and market rate cut pricing. GBP is slightly lower following yesterday's gains, with attention now shifting to tomorrow's BoE meeting.
- Eurozone final CPI data is also due today, though it is expected to have limited market impact.
- Focus later turns to the Fed meeting, where a 25bps rate cut is anticipated. The Fed may also revise next year’s rate cut projections, factoring in potential fiscal stimulus under President-elect Trump.
- Unless the Fed surprises with a dovish tone, USD is likely to remain well-supported.
18th December 2024
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