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USD quick out the traps

USD quick out the traps

The Dollar was quick out the traps this year, gaining largely against the Pound and the Euro throughout yesterday’s trading session. Risk sentiment change has seen the Dollar gain back some of the losses suffered after the Fed rate cut narrative come into play at the end of 2023. The recent Dollar strength is due to the US Navy shotting down two anti-ship missiles and sinking three small boats after responding to distress calls from a container ship that was attacked twice by Houthi rebels as it crossed the Red Sea over the weekend, Iran then sent warships into the Red Sea after the US strikes in retaliation. Last time the Red Sea saw any issues, the blockage of the Suez Canal, the incident put huge inflationary pressure on the global economy.


The Pound finished last year as one of the better performers as markets begin to price in that the Bank of England will be the last of the three main central banks to cut interest rates in 2024. While the Fed sits at a 90% probability of cutting rates in March and the European Central Bank at 60%. The BoE is at the lowest level with a 35% chance of rate cuts in March, lending support to the pound against its peers

Yesterday saw currency markets rocked as a result of US navy action, getting the year off to a volatile start. Have you got anything that you missed at the end of last year that needs to be settled?

Ryan Cutts
FX Account Manager Corporate & Private
+44 (0) 20 3598 5420
equalsmoney.com



Written by: Ryan Cutts

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