France
16 December 2024
Weekly Market Headlines:
- Both the UK and Eurozone are due to release inflation figures on Wednesday. These reports may shape their central banks’ monetary policies moving into 2025.
- With UK inflation still higher than expected, markets are expecting the Bank Of England to keep interest rates unchanged on Thursday. An outside chance of a rate cut could cause volatility.
- The euro continues to struggle against the pound and US dollar, following three consecutive rate cuts by the European Central Bank.
- On Wednesday evening, the Federal Reserve will announce its final monetary policy decision of 2024. Markets are anticipating a potential rate cut, which could lead to USD volatility.
This week is shaping up to be an important one for the currency markets, with several key updates that could influence your currency plans.
On Wednesday, inflation data will be released for both the UK and the Eurozone. These figures are closely watched as they often guide central banks in setting interest rates. With UK inflation still higher than expected, markets are expecting the Bank Of England to keep interest rates unchanged on Thursday. An outside chance of a rate cut could cause volatility.
In the Eurozone, a series of three rate cuts has put the euro under pressure, weakening it against both the pound and the US dollar. Wednesday’s data may provide further direction for the European Central Bank’s next steps.
The US Federal Reserve will also deliver its final policy decision of the year on Wednesday evening. Markets are speculating about a potential third rate cut in 2024, which could result in significant USD volatility depending on the accompanying statement.
These developments may create opportunities or challenges depending on your currency needs. Call your dedicated currency specialist on +44 (0) 203 384 7280 to discuss how we can support your trading needs.
What events might move exchange rates this week?
GBP
- Tuesday: Labour data
- Wednesday: Inflation data
- Thursday: Bank of England decision
- Friday: Retail sales
EUR
- Wednesday: Inflation data
USD
- Tuesday: Retail sales
- Wednesday: Federal Reserve monetary policy decision
- Thursday: GDP data
