Marketwatch EU & UK

Daily Insights
March 8, 2024

  • On the second day of Jerome Powell’s testimony to Congress the Fed Chairman suggested that the central bank is getting close to the confidence it needs to start lowering interest rates. “We’re waiting to become more confident that inflation is moving sustainably at 2%” he said, adding, “When we do get that confidence – and we’re not far from it – it’ll be appropriate to begin to dial back the level of restriction.” The Chairman was again non-committal around the precise timing of the first move, repeating Wednesday’s suggestion that rates would be cut, “at some point this year.” The greenback lost ground and treasury yields dropped with traders boosting bets on a rate cut coming at the June FOMC meeting.
  • As expected, the ECB held rates steady at yesterday’s policy meeting with President Christine Lagarde later suggesting that officials may be in a position to lower rates in June. New forecasts show inflation hitting the ECB’s 2% goal in 2025, however Lagarde reiterated that policymakers are not “sufficiently confident” to start cutting yet, adding, “we clearly need more evidence, more detail,”
  • The dollar index fell to its lowest level in seven weeks, helping push EURUSD and GBPUSD to fresh highs ahead of today’s US Non-farm Payroll release. EURUSD has moved through recent resistance to trade as high as 1.0956 and cable is currently trading a whisker above 1.28. All eyes will be on this afternoon’s labor market report with markets looking for a print around 200k following last month’s bumper 353k release.

Economic Calendar

:
USD - President Biden Speaks
:
JPY - Economy Watchers Sentiment
:
JPY - Leading Indicators
:
EUR - German Industrial Production m/m
:
EUR - German PPI m/m
:
EUR - French Trade Balance
:
CNY - New Loans
:
CNY - M2 Money Supply y/y
:
EUR - Final Employment Change q/q
:
EUR - Revised GDP q/q
:
USD - FOMC Member Williams Speaks
:
CAD - Employment Change
:
CAD - Unemployment Rate
:
CAD - Capacity Utilization Rate
:
USD - Average Hourly Earnings m/m
:
USD - Non-Farm Employment Change
:
USD - Unemployment Rate

Market Indicators

Currency Pairs
Pair High Low
eur/gbp 0.85483 0.85442
gbp/usd 1.28198 1.2804
gbp/aud 1.9366 1.93085
gbp/nzd 2.07842 2.07282
usd/jpy 148.119 147.521
eur/usd 1.09557 1.09441
gbp/jpy 189.713 189.113
eur/cnh 7.88661 7.8761
usd/cnh 7.2032 7.19293
Equities and Commodities
Nasdaq 100 18264.6
DOW 38750.1
S&P 500 5158.06
BRENT CRUDE 83.36
WTI 79.51
GOLD 2157.9

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.

About Simon Walker

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Simon Walker is head of the GPS Capital Markets trade desk in our London office where he is responsible for covering market risk in European hours. He has over 25 years’ experience in foreign exchange, working in both sales and trading.