Market Insights

Market Information Tuesday 4 February 2025

Eurozone inflation increased to 2.5% in January, exceeding economists’ expectations of 2.4%, driven by a sharp rise in energy costs, according to Eurostat. Core inflation, which excludes volatile items like energy and food, remained at 2.7% for the fifth consecutive month. Meanwhile, services inflation edged slightly lower to 3.9%. The European Central Bank (ECB) remains confident that inflation will gradually return to its 2% target in 2025, despite persistent services inflation. The ECB recently cut interest rates by 25 basis points and is expected to ease further throughout the year. However, economists warn that inflation risks, including potential EU-U.S. trade tariffs, could complicate the outlook.

Bitcoin rebounded above $99,500 after initially plunging to $91,200 following U.S. tariffs on Mexico, Canada, and China. The recovery came as the U.S. agreed to pause Mexico’s tariffs for a month. Despite the market turbulence, analysts say Bitcoin remains the crypto industry’s reserve asset, attracting liquidity in times of uncertainty. Other cryptocurrencies, including Ether, saw steeper losses, with long liquidations exceeding $850 million across the market. While some experts believe prolonged trade tensions could ultimately benefit Bitcoin by weakening the U.S. dollar, near-term volatility remains a risk, with $90,000 seen as a crucial support level.

Asian markets rallied Tuesday after Donald Trump delayed tariffs on Mexico and Canada. Japan’s Nikkei 225 gained 1.15%, South Korea’s Kospi rose 1.52%, and Hong Kong’s Hang Seng climbed 2%. Australia’s ASX 200 saw a modest 0.2% increase, while India’s Nifty 50 and Sensex opened higher. Meanwhile, U.S. markets struggled despite the tariff pause. The Dow Jones pared losses but still closed down 0.28%, while the S&P 500 and Nasdaq fell 0.76% and 1.2%, respectively. Investors remain cautious amid ongoing trade uncertainty.

The 6M Euribor is unchanged at 2.59% compared to previous business day. The 10Y Swap decreased with 7 basis points to 2.34% 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.

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