Dear Reader,

Today's overview of economic news and market action:

• Mixed mood amid choppy trading conditions last week … 
• Both the Fed & ECB hiked rates by 25bps last week, while the BoJ tweaked yield curve control …
• Currency-wise, the euro was on the defensive throughout last week … 
• EUR/USD opens this morning in the lower half of $1.10-1.11 …
• EUR/GBP is down near the midpoint of 85-86p …
• Elsewhere, USD/JPY is in the top half of ¥141-142 …
• This week, the BoE policy meeting will be in focus …
• A busy data schedule includes the US labour market report & Eurozone inflation …

End of the Line?

Markets remain of the view in the aftermath of the past week’s Fed and ECB policy meetings - which saw them both raise rates by 25bps - that the rate hiking cycles in the US and Eurozone have either drawn to a close or are very close to the end.

ECB raises rates again, leaves options open about further hike

As had been well signalled, the July meeting of the ECB’s Governing Council saw the central bank raise rates by a further 25bps, pushing the key deposit rate up to 3.75%

Fed hikes by 25bps, keeps its options open

As widely expected, the Fed hiked US rates by 25bps at the conclusion of its policy meeting yesterday, bringing the target range for the funds rate up to 5.25-5.50%. 

PMI declined to 47.3 in June, indicating a further softening in business conditions. New orders, and output fell. Meantime, there was a further easing in inflationary pressures Traditional industrial production rose by 3.8% in the 3 mths to May. 3 mma up 6.6% YoY also.