BoE Speeches & Eurozone Inflation
Markets open the week with central bank speeches and Eurozone inflation data. The Bank of England (BoE) will take centre stage as multiple policymakers speak throughout the day. Meanwhile, U.S. political developments may influence the dollar. Additionally, markets could react to Eurozone inflation figures, which may impact expectations for European Central Bank (ECB) policy.
Key Data Out Today
- BoE Speeches: Lombardelli, Ramsden, and Dhingra are set to speak, providing insight into the central bank’s stance on interest rates.
- Eurozone Inflation Data: The latest Harmonized Index of Consumer Prices (HICP) for January will be released. Markets expect core inflation to remain stable at 2.7% year-over-year, which could impact ECB rate expectations.
- U.S. Political Developments: A speech by President Trump could shift risk sentiment, particularly for the dollar.
Commodities
- Oil Prices Edge Lower:
- WTI Crude: Down 0.37% to $70.14 per barrel, pressured by weak demand concerns.
- Brent Crude: Lower by 0.26% at $74.23 per barrel, reflecting cautious market sentiment.
- Gold Gains on Uncertainty:
- Gold is up 0.35%, trading at $2,944 per ounce, as investors hedge against uncertainty surrounding central bank policy and geopolitical risks.
- Silver follows suit, rising 0.18% to $32.57 per ounce.
Currency Movements
EUR/USD (1.0482, ↑ 0.22%)
The euro is inching higher ahead of the Eurozone inflation data release. Markets are closely watching the core inflation figure, as a surprise increase could push back European Central Bank rate cut expectations, offering further support to the euro.
GBP/USD (1.2640, ↑ 0.06%)
The pound is slightly higher as traders await speeches from multiple Bank of England officials. Markets are looking for fresh signals on rate policy, particularly regarding how soon the BoE might consider rate cuts.
AUD/USD (0.6363, ↑ 0.09%)
The Australian dollar is marginally higher, tracking a modest rebound in risk sentiment. However, softening commodity demand and concerns over China’s growth outlook could limit further upside.
NZD/USD (0.5746, ↑ 0.11%)
The New Zealand dollar is firming, benefiting from a slightly weaker U.S. dollar and improving market risk appetite. However, RBNZ policy expectations remain a key factor for future direction.
USD/JPY (149.39, ↑ 0.04%)
The yen remains steady, with traders watching risk sentiment and U.S. political developments. A hawkish tone from Federal Reserve officials could trigger renewed yen weakness.
USD/CNY (7.2480, ↓ 0.06%)
The Chinese yuan is inching lower as economic growth concerns persist. Despite Beijing’s efforts to stabilize the economy, investor sentiment remains cautious regarding China’s recovery trajectory.
USD/CHF (0.8970, ↓ 0.21%)
The Swiss franc is gaining ground as investors lean toward safe-haven assets. This reflects some caution in global markets, despite the U.S. dollar showing broader resilience.
USD/CAD (1.4203, ↓ 0.19%)
The Canadian dollar is strengthening slightly, supported by steady crude oil prices. However, a dovish Bank of Canada outlook remains a potential drag for the loonie.
USD/MXN (20.42, ↑ 0.02%)
The peso is holding steady as markets assess global risk appetite. Any dollar strength from political or economic developments in the U.S. could pressure the peso further.
USD/INR (86.69, ↑ 0.05%)
The Indian rupee is little changed, reflecting stable capital flows and a lack of major domestic catalysts. A stronger U.S. dollar could weigh on the rupee later in the session.
Market Outlook
Markets are likely to remain data-driven today, with BoE speeches and Eurozone inflation data shaping expectations for future monetary policy moves. A higher-than-expected inflation print could fuel speculation that the ECB may delay rate cuts, boosting the euro. Meanwhile, the U.S. dollar’s direction will depend on political headlines and broader risk sentiment.
Gold remains well-supported above $2,940, benefiting from uncertainty around monetary policy and market volatility. Oil prices are under pressure, reflecting persistent concerns about global demand.