EUR/GBP Tumbles—Is the ECB About to Drop a Monetary Policy Bombshell That Could Shake Markets?
Bailey also downplayed concerns around the recent rise in UK borrowing costs, saying it’s part of a broader global trend rather than a reflection of domestic fiscal risks. His remarks helped reassure markets that the BoE remains committed to financial stability. Additionally, the Bank confirmed it is pausing its work on the development of a digital Pound, citing progress in private sector innovation and reduced urgency for central bank intervention in the payments space.
Looking ahead, all eyes are now on Thursday’s packed economic calendar, with ECB monetary policy decision and Purchasing Managers Index (PMI) data due from the Eurozone, the United Kingdom, and the United States. While the ECB is expected to keep rates unchanged, markets will closely watch President Lagarde’s tone for clues on the future path of rates, especially after she signaled that the easing cycle may be nearing its end. Softer-than-expected Eurozone PMI figures could reinforce a cautious stance and pressure the Euro further. Meanwhile, UK PMIs are expected to show continued resilience, particularly in services, which could support the Pound.
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