Trade war roared back into focus late last week, derailing fragile market sentiment already strained by concerns over the ballooning US deficit. The catalyst came in the form of a sharp threat from US President Donald Trump on European Union imports. This abrupt escalation shattered hopes that the 90-day truce period would lead to calmer…
UK inflation accelerated more strongly than forecast, casting doubt on the likelihood of a rate cut by the Bank of England any time soon. The overall consumer price index increased 1.2% in April, the strongest monthly jump since April 2022. The annual rate of growth accelerated from 2.6% to 3.5%, the highest since January 2024….
Last week was dominated by developments out of the US and UK, not just because of monetary policy decisions, but also the unexpected announcement of a US-UK trade deal. Fed’s hold and BoE’s cut were were largely overshadowed by the surprise trade breakthrough. Importantly, the structure of the agreement offered valuable insights into the US…
Markets The Bank of England stuck to its quarterly cutting pace in place since August of last year. They lowered the key policy rate by 25 bps to 4.25% in a 3-way vote. Five out of nine members supported the decision with two in favour of a larger, 50 bps, rate cut and two in…
US stock futures dipped on Monday as investors prepared for a busy week of important economic reports and earnings from major Wall Street companies, while keeping an eye on updates about the Trump administration’s trade policies. The US open has led to a bounce for US indices as markets digest comments from Treasury Secretary Scott…
Markets April EMU PMI surveys showed business activity broadly unchanged. The composite gauge dipped from 50.9 to 50.2 (vs 50.1 expecting), narrowly holding above the boom/bust level (50) for the fourth consecutive month. There were contrasting trends between marginally decreasing business activity in services (49.7 from 51) and the manufacturing sector holding up better than…
Key Highlights GBP/USD started a consolidation phase below the 1.3000 resistance. A key declining channel or a bullish flag is forming with resistance at 1.2955 on the 4-hour chart. EUR/USD is eyeing a fresh increase above the 1.0870 resistance zone. Gold prices corrected some gains after setting a record high near $3,150. GBP/USD Technical Analysis…
Technical Analysis Current Policy Rate: 0.5% (Highest since 2008) Previous Hikes: March 2024: Exit from ultra-loose stimulus. July 2024: Rate increased to 0.25%. January 2025: Rate increased to 0.5%. Fundamental Factors Affecting the BOJ’s Decision Accommodative Financial Conditions Persist Policymakers acknowledged that interest rates remain negative, even after the latest hike. Further tightening remains an…
Risk Assets continue to struggle despite some gains in the S&P 500 and Dow Jones. It highlights investor concerns about US trade policies and the Federal Reserve’s stance on inflation. On the economic data front, we have PMI and inflation figures in the US, Europe, UK, and Asia Pacific. We also key events like Japan’s…
The Bank’s Monetary Policy Committee (MPC) voted by a decisive 8:1 majority to maintain rates, indicating that more and more Bank members are becoming increasingly concerned about rising inflation since February. Given that inflation will reach 4.0% in the coming months, there are concerns that current forecasts of a gradual decline in inflation in 2026…