Market Information Tuesday 18 February 2025

Europe’s aerospace and defense sector soared, adding €18 billion in market value as investors bet on rising military budgets. The STOXX Europe Aerospace & Defense index jumped 4.4%, hitting a record high, with Rheinmetall (+14%), BAE Systems (+9%), and Saab (+16%) leading the gains. Growing geopolitical tensions and NATO’s push for higher spending fuelled the rally.

Philadelphia Fed President Patrick Harker supports keeping U.S. interest rates steady, citing restrictive policy and resilient growth. While optimistic about inflation easing, he avoided committing to a timeline. Markets expect a rate cut in July, but Harker, an alternate FOMC member, will only vote if a full member is absent.

The Reserve Bank of Australia (RBA) cut rates by 25 basis points to 4.10%, its first cut since 2020, as inflation declines faster than expected. However, the RBA remains cautious, signalling a gradual easing cycle. The Australian dollar strengthened, but the ASX 200 fell 0.54% following the decision.

The 6M Euribor is unchanged at 2.51% compared to previous business day. The 10Y Swap increased with 1 basis point to 2.43% 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.