S&P 500 — US Large Cap Index
FTSE 100 — UK Blue Chips
Euro Stoxx 50 — Eurozone Leaders
DAX 40 — German Equities
CAC 40 — French Market Index
Nikkei 225 — Japan Benchmark
Hang Seng — Hong Kong Index
Shanghai Composite — China Mainland
ASX 200 — Australian Market
TSX Composite — Canada Index
Nifty 50 — India Large Cap
STI Index — Singapore Market
KOSPI — South Korea Index
Bovespa — Brazil Equities
JSE Top 40 — South Africa Index
IPC Index — Mexico MarketThe Pound Sterling (GBP) reversed its gains after UK inflation came in below expectations, leaving the market focused on the Bank of England’s (BoE) rate cut today and the potential for further easing in upcoming meetings, Commerzbank’s Head of FX and Commodity Research Thu Lan Nguyen notes.
BoE rate cut already priced in, market eyes next moves
“Yesterday, British inflation figures surprised on the downside across the board. As a result, the pound completely gave up its gains against the euro from the previous day, as the path to further interest rate cuts now seems to be paved. As we have already emphasized, an interest rate cut by the Bank of England today is already priced in. The big question is whether and how many further steps will follow in the next meetings.”
“After last Friday’s disappointing growth figures, the weaker inflation figures now alleviate the Bank of England’s dilemma of a weakening economy and inflation above target, at least to some extent. And that would actually be positive for the pound. Inflation had recently proven to be extremely stubborn, which is why the latest interest rate cuts, including today’s move, should be viewed with caution.”
“However, after yesterday’s data, it remains to be seen whether price pressure will actually ease sustainably. If this is not the case and the BoE continues to cut interest rates, this would be bad news for the British currency.”
