Big week ahead for markets—UK inflation, US spending, and key central bank signals. How will this impact your business? Book a call with the Garton Global team to discuss your currency strategy.
Last Week: What Moved Markets
🇪🇺Euro Falls Despite German Deal as Markets Take Profit
● The euro slipped on Friday despite Germany securing a landmark spending deal, a classic case of “buy the rumour, sell the fact.”
● The agreement, which allows for massive infrastructure and defence investment, was expected to lift sentiment but instead triggered profit-taking.
● Meanwhile, European equities rallied, with capital shifting from US stocks as investors bet on Germany’s fiscal expansion boosting regional growth.
🏆Gold Hits Record High as Trade War Fears Intensify
● Gold surged past $3,000 per ounce on Friday as investors sought safe-haven assets amid fears of a global trade war.
● Uncertainty over President Trump’s shifting tariff policies and their impact on global growth fuelled demand for bullion.
● Wall Street stocks fell, with inflation concerns and economic slowdown fears adding to the risk-off sentiment.
🏦Central Banks Hold Rates as Growth Prospects Deteriorate
● The Federal Reserve cut its US growth forecast to 1.7% for 2024, citing inflation risks from Trump’s tariff plans.
● The Bank of England held rates at 4.5%, with policymakers concerned inflation may not fall as quickly as expected.
● Weak UK manufacturing data and slowing hiring point to recession risks, likely forcing fiscal tightening in the upcoming Budget.
This Week – What to Watch
🇬🇧 Sterling Faces Key Tests as Inflation and Fiscal Plans Take Focus
● Monday’s PMI data will signal whether UK businesses are feeling the strain of global trade uncertainty and hiring slowdowns.
● Wednesday’s CPI report will test the Bank of England’s stance, with inflation still hovering at the top of its buffer.
● Spring Statement risk—spending cuts may reassure markets, but without a clear growth plan, sterling’s rally could stall.
🇺🇸 US Consumer Spending in Focus Ahead of Key Inflation Data
● Friday’s PCE report will reveal whether consumer spending rebounded after January’s 0.2% decline.
● Inflation expectations—headline PCE likely eased to 2.4% y/y, but core inflation remains stubborn at 2.6%.
● Market reaction—a spending slowdown could revive growth concerns, weighing on the dollar and Fed rate cut expectations.
Key events
Monday March 24th
08:15 French PMI’s
08:30 German PMI’s
09:30 UK PMI’s
13:45 US PMI’s
Wednesday March 26th
00:30 Australian CPIs
07:00 UK CPI’s
Thursday March 27th
00:30 US GDP & Unemployment Claims
Friday March 28th
07:00 UK Retail Sales
00:30 Canadian GDP & US PCE Price Index
Questions on how this impacts your business?
Get in touch with the Garton Global team today.