Market Information Thursday 24 October 2024

The US dollar has surged to its highest level since August, driven by strong economic data and investor expectations of Donald Trump’s potential election victory. The currency’s nearly 4% rise since late September is supported by strong jobs data and reduced Fed rate cut expectations. Investors anticipate Trump’s policies will increase inflation and interest rates, further strengthening the dollar amid election uncertainties.

France aims to narrow its budget deficit with €60bn in tax hikes and spending cuts, risking growth in a fragile economic climate. Analysts warn these fiscal measures could impact GDP and employment, challenging President Macron’s goals and straining the Eurozone. The Barnier government, lacking a parliamentary majority, faces political obstacles in implementing unpopular policies to address persistent deficits, including the costly pensions system.

The IMF has upgraded the UK’s growth forecast, projecting growth of 1.1% this year and 1.5% in 2025, boosting Chancellor Rachel Reeves ahead of her Budget announcement. This positive outlook is attributed to falling inflation and interest rates, potentially leading to more aggressive rate cuts by the Bank of England. Despite the improved forecast, Reeves faces challenges in balancing economic growth with reducing public debt and closing a £40bn funding gap.

The 6M Euribor decreased with 2 basis points to 2.95% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.45% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.