Tag Archives: USD

Today’s economic updates reveal challenging conditions for the UK economy, as retail sales and currency movements highlight the impact of ongoing uncertainties. Here’s a closer look at the latest developments.

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UK Retail Sales: A Decline in Consumer Spending

This morning’s release of the UK’s Retail Sales data showed a month-on-month decline of 0.3%, a stark drop from the 0.5% growth recorded last month. The slowdown reflects mounting pressure on the retail sector, with consumer spending hampered by economic uncertainties.

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Pound Weakens After Interest Rate Decision

The pound has faced significant pressure following yesterday’s Bank of England interest rate decision. The main driver behind its decline was the unexpected split in the Monetary Policy Committee (MPC), where three members voted to cut rates.

This divergence has amplified concerns about the UK’s economic outlook and added volatility to the currency markets:

• Against the dollar, the pound has fallen over 100 points, with the dollar’s strength underpinned by robust US economic performance.
• Against the euro, sterling has shown relative resilience, as ongoing Eurozone struggles weigh on the euro.

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Uncertainty Over 2025 Monetary Policy

The Bank of England’s indication of four rate cuts in 2025 has been met with scepticism. Labour’s recent budget, expected to fuel higher inflation, casts doubt on the feasibility of such projections. This uncertainty has left markets in a state of flux, awaiting clearer signals on future monetary policy.

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US Data in Focus

Later today, the US will release its Personal Income data, with core price growth forecasted at 0.2%, slightly down from last month’s 0.3%. This release could shape market sentiment and influence further currency movements, particularly for the dollar.

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How Could This Impact Your Business?

The combination of weaker UK retail sales, volatile exchange rates, and shifting monetary policies highlights the importance of staying agile in uncertain markets. For businesses with international exposure, understanding these dynamics is critical to managing risks and capitalising on opportunities.

Speak to Qumoney’s experts today for bespoke strategies to navigate currency fluctuations and protect your bottom line.

Global markets are reacting to a series of critical updates, including the Federal Reserve’s latest interest rate cut and upcoming decisions from the Bank of England. Here’s what you need to know:

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Federal Reserve Cuts Interest Rates

Last night, the Federal Reserve announced a 0.25% rate cut, bringing its benchmark rate down to a range of 4.25%–4.50%. While this is the final rate cut of the year, the Fed signalled it plans fewer rate cuts in 2025 as it continues to prioritise battling inflation.

The news had an immediate impact on the markets:

• Stock markets fell sharply in response to the Fed’s ‘hawkish’ stance.
• The US dollar strengthened, bolstered by the central bank’s commitment to tighter monetary policy.

This marks the last major rate decision before Donald Trump assumes the presidency in January, adding another layer of interest to the Fed’s outlook.

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Bank of England Decision Looms

Today, attention turns to the Bank of England, which will vote on whether to hold or cut interest rates. While no change in policy is widely expected, the market’s focus will be on post-decision commentary.

Although there will be no official press conference, Governor Andrew Bailey’s interview later in the day will be closely watched. Markets are eager for clues about the central bank’s strategy heading into 2025, especially in light of the UK’s ongoing inflation challenges.

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Euro Under Pressure

The euro continues to struggle, falling against both the pound and the dollar. This decline follows months of disappointing economic and political data from the Eurozone. With sentiment deteriorating, the euro faces increasing pressure in the global currency market.

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How Could This Impact Your Business?

Interest rate decisions and currency fluctuations create opportunities and risks for businesses engaged in international trade or investments. With the dollar gaining strength and the euro under pressure, navigating these shifts requires strategic planning.

Reach out to Qumoney’s experts today for tailored advice on managing currency risks and making the most of market volatility.

Today’s financial headlines are dominated by rising inflation and pivotal interest rate decisions across the globe. Here’s a quick breakdown of the latest developments and what they could mean for businesses and investors.

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UK Inflation Rises Above Target

The Office for National Statistics (ONS) revealed that UK CPI inflation climbed to 2.6% in November, surpassing the Bank of England’s 2% target. This increase aligns with expectations following stronger-than-anticipated wage growth data released yesterday. Rising wages are fuelling demand in the UK economy, keeping inflation elevated and placing additional pressure on the Bank of England’s next move.

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Eurozone Inflation in Focus

Later this morning, the Eurozone is set to release its CPI inflation figures, with a forecasted increase of 0.3%. This would bring the headline rate to 2.3%, pushing it above the European Central Bank’s (ECB) 2% target. Investors will be watching closely as higher inflation across the region could influence ECB policy in the months ahead.

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Federal Reserve to Cut Rates

The day will conclude with a key announcement from the Federal Reserve, which is expected to lower its headline interest rate to the 4.25%-4.50% range. This decision is good news for US homeowners, as it will likely lead to lower monthly mortgage payments. However, all eyes will be on Jerome Powell’s comments, as investors look for any signals about potential rate cuts in 2025.

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What’s Next for the Bank of England?

Looking ahead to tomorrow, the Bank of England is expected to keep interest rates unchanged following recent economic shifts, including rebounding wage growth and rising inflation. The GBP/EUR exchange rate is currently trading at a key resistance level. If the Bank’s decision supports market confidence, we could see the Pound strengthen further.

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How Could This Impact Your Business?

Market volatility is likely to remain high as inflation and interest rate decisions drive investor sentiment. Whether you’re looking to hedge against currency risks or take advantage of favourable exchange rates, staying informed is crucial.

Contact Qumoney’s experts today for tailored insights and strategies to help your business navigate these developments and capitalise on market opportunities.

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This week promises to be pivotal in the world of finance, with major economic updates shaping the trajectory of global markets. Let’s dive into the highlights, starting with the UK, where critical data is already making waves.

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UK: Employment Figures and Bank of England Decision Loom Large

The UK kicked off the week’s economic updates with the release of its ILO Unemployment Rate, which is expected to hold steady at 4.3%. While stability is often seen as a positive, this figure carries significant weight as we approach Thursday’s Bank of England interest rate decision. The current rate of 4.75% is expected to remain unchanged, but with fresh data due today and tomorrow, any surprises could sway market sentiment and alter the outlook.

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Europe: Political Shifts and Economic Sentiment in Germany

Across the Channel, Europe faces a mix of political and economic challenges. In Germany, Chancellor Olaf Scholz lost a vote of confidence yesterday, triggering early elections set for February. This political instability comes at a crucial time for Europe’s largest economy. Adding to the tension, Germany will release its Business Confidence data today, which could further influence the fragile market sentiment.

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US: Retail Sales in Focus Ahead of Fed Decision

Over in the US, attention is squarely on today’s Retail Sales report, which is forecast to show a modest increase of 0.1% to 0.5%. This data will be a key factor in shaping tomorrow’s Federal Reserve policy decision. Unlike the UK, there’s growing speculation that the Fed may cut interest rates by 0.25%, even as the broader economy continues to demonstrate resilience. A rate cut would send ripples across global markets, affecting currency values and investor confidence.

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Currency Markets: Volatility Ahead

Currency markets kicked off the week with the pound gaining strength, rising 60 points against both the dollar and the euro. However, with a packed schedule of economic data ahead, volatility is expected to remain high. Businesses involved in international transactions should be prepared for potential fluctuations in exchange rates as markets react to these developments.

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How Could This Impact Your Business?

With key economic updates and policy decisions looming, market volatility presents both challenges and opportunities. Whether you’re looking to hedge against currency risk or seize favourable exchange rates, staying informed is crucial.

Speak to one of Qumoney’s experts today for tailored insights and strategies to help your business navigate these market shifts and capitalise on emerging opportunities.