Dollar gains dominated the European morning on Wednesday after Fed Dudley’s hawkish comments overnight and the Euro dipped to below 1.0550 against the US currency, although rising German yields eased net selling pressure to some extent.
German consumer process rose 0.6% in February with the annual inflation rate rising to 2.2% from 1.9% previously and this was the highest rate for over four years.
With German unemployment continuing to decline, there will be expectations of higher wage settlements which could also unsettle the Bundesbank and increase pressure for a tighter monetary policy.
European Interest Rates More momentum on rate cuts in the Eurozone as expectations grew for cuts starting in March and totalling 140bps in 2024. Equally in the UK cuts of 130bps starting in June are being pencilled in to market calendars. What this means is that GBP/EUR is looking more than especially good value at […]
Eurozone That was a surprise: yesterday the EU announced that inflation had fallen to 2.4% which was considerably better than the 2.7% that markets had expected. Despite the ECB saying it was far too early to cut rates, the market has pencilled in the first cut for April. Before getting carried away it should be […]
Dutch Election What the Hard Right under Geert Wilders winning by the largest number of seats(37) means for Europe will become clear in the next months but for the Netherlands the composition of their new coalition government is expected to take a month and will likely comprise 4 or even 5 parties. This may or […]