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.
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.
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.
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.
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.
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.