Dear Reader,

Today's overview of economic news and market action: 

• Fed left policy on hold yesterday as expected …
• However, two officials dissented, in favour of cutting rates by 25bps …
• Despite this, Chair Powell struck a hawkish tone at the press conference …
• Against this backdrop US rate expectations and the dollar firmed …
• This sees EUR/USD open today back at the midpoint of $1.14-1.15 …
• GBP/USD is trading below the $1.33 mark …
• EUR/GBP remains in the lower half of 86-87p …
• Today, SU core-PCE inflation (June) is due …

All rates quoted are indicative market rates.

The Summer Economic Statement (SES) and National Development Plan (NDP) are key milestones towards Budget 2026. The SES sets out the fiscal boundaries of the Budget 2026 package to be announced in the autumn, while the NDP outlines the Government’s medium-term infrastructure priorities.

The July ECB Governing Council meeting saw the central bank leave interest rates on hold. The deposit and refi rates were maintained at 2.00% and 2.15%, respectively. This was the first ECB meeting of 2025 where the central bank refrained from lowering rates. However, this outcome was very much in line with market expectations.