Earlier in the week we did see both core inflation and inflation levels decrease in April for the US. While retail sales showed a slowdown too, this lead to USD weakness. Market speculated that a chance of US lower their borrowing costs in September increased. The recent USD weakness came to a halt last night after a number of speeches from Federal Reserve officials.

Quieter times are expected for The US Dollar over the next few weeks after recent economic releases initially showed mixed signals with their economy. Yesterday’s April Inflation release showed a slight drop as expected, as Inflation excluding food and energy increased by a mere 0.3% against a 0.4% projection.

Technical indicators are one of the main factors that most traders rely on to determine the presence of imbalances in the financial markets. Such indicators help to understand the current market situation and help determine the price.

Recent market focus has centered around European Inflation figures with Germany’s April Inflation figures released yesterday. Inflation in general rose slightly more than anticipated off the back of strong food and energy prices, initially denting investors hopes on an Interest Rate cut next month.

Consumer prices increased by 0.1% in April compared to the same period 12 months prior, however when stripping food and energy prices out, Inflation had actually fallen from 3.3% to 3%. What this shows is the difficulty that many Central Banks globally are experiencing in bringing inflation down to the preferred 2% level.

This morning we have seen German inflation levels cooled down for its first time in 2024, being unchanged from March to April at 2.2%. After 3 consecutive months of drop in inflation for the European country, it has now flatlined. Inflation is not the issue for Germany and other European countries, what has been and continues to be the concern is lack of economic growth.

The last week was pretty volatile for Sterling exchange rates, with the Pound falling prior and following the BoE decision. The simple update is that 2 members voted for a cut which meant that traders have now started to price in the first BoE cut for June - this essentially weakened off the Pound through Thursday.

As the allure of Portugal's Golden Visa programme persists, recent changes have catalysed a significant shift towards investment in the Algarve region.

This morning has seen GBP continue to lose further ground against both The Euro & US Dollar in particular as we lead up to The Bank of England’s rate decision tomorrow. Current feelings within the market are pretty much in line with rates being unchanged, however what we anticipate might move the markets is whether the number of members voting for a cut will have increased from the solitary one member last time, or whether it’ll still be a minority in favour.