Dear Reader,

Here is an overview of today's economic news and market action:

• Busy central bank diary last week
• Both Fed and ECB hiked by 25bps
• Fed opened the door to ‘pausing’
• ECB indicated more hikes to come
• However, despite this, the euro was on the defensive
• EUR/USD struggled to hold onto $1.10
• EUR/GBP fell below 88p
• Ahead this week, BoE is expected to hike by 25bps

The Next Cycle

The US Fed has opened the door to pausing its rate hiking campaign, following a 25bps rate increase at its latest policy meeting, which brought the funds rate up a 5.0-5.25% range.

ECB slows pace of rate hikes to 25bps, but is not pausing

The May meeting of the ECB’s Governing Council saw the central bank raise rates by 25bps, bringing the key deposit rate up to 3.25%.

Sharpest growth in new orders in a year 

Following March’s softer upturn, the Irish service sector regained growth momentum at the start of the second quarter of the year.