Daily Alert – Thursday 1st February 2024: Fed fails to get the party started

Mark NugentDaily Alert, February 2024

Daily Alert – Thursday 1st February 2024: Fed fails to get the party started

Good afternoon.

Last night the Fed held the interest rate at 5.25% to 5.50% as expected. Fed Chair Powell made it quite clear there would be no cut at the next meeting in March. This party-poopery drove equities down and the USD up, as you might imagine.

Today, over at the Bank of England, the Monetary Policy Committee voted to keep rates at 5.25%, as expected. One of the MPC members voted for a cut, the first such vote in four years. Inflation is expected to hit the target of 2% in the second quarter of this year but to rise thereafter before eventually falling to target again in late 2026. Governor Bailey said that inflation risks are skewed to the upside. He’s thinking about things like tax giveaways in the forthcoming budget that the Conservatives may provide in a desperate attempt to avoid the extreme bottom smacking coming his party’s way at the next election.

In the eurozone, inflation disappointed by not falling as fast as ECB President Lagarde had demanded it must. The Euro rose.

I’ll be back tomorrow with a short video on Trade 2, Japan225, +2.34%.

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