ECB interest rate decision in focus today
Written by
Daily Currency Update
Today's ECB meeting will initiate a new series of central bank monetary policy reviews. Next week, the Fed is scheduled to meet, following the Bank of Canada's interest rate cut on Wednesday, making it the first G7 country to do so.The ECB is highly likely to cut interest rates from record highs today. Investor focus will be on the accompanying comments and economic projections to assess the future policy direction post the expected rate cut. Markets are currently pricing in 64 basis points of cuts for the ECB in 2024.
Key Movers
The US dollar faced headwinds yesterday due to softening labor market conditions in the States, which bolstered expectations for Federal Reserve rate cuts this year. Wednesday's data revealed that the US services sector returned to growth in May after a brief contraction in the previous month. However, the survey details indicated that employment remained in contraction territory.Markets have now priced in nearly 50 basis points of Fed rate cuts for 2024, with the first cut expected in September.
Expected Ranges
- GBP/USD: 1.2765 - 1.2845 ▲
- GBP/EUR: 1.1735 - 1.1795 ▲
- GBP/AUD: 1.9185 - 1.9275 ▲
- EUR/USD: 1.0845 - 1.0925 ▲