The infoshot to help kick-start your week
The ECB confirmed market expectations by opting for a 50 basis point interest rate hike last week, taking the key rate to 2.5%. Eurozone inflation fell for the third consecutive month in January, flash data on Wednesday showed, but the bank pledged to ‘stay the course’ and continue to raise rates at a ‘significant and steady pace’. Notably, the bank also stated that it intended to hike by another 50 basis points in March.
The BoE also raised rates by 50 basis points last week, talking down expectations that it is ready to pause or pivot in its fight against inflation, noting that there is a still a way to go. The BoE also stated that while the UK is set to enter recession this year, it will be shorter and less severe than initially forecasted. In the wake of recent price data, the slump is now expected to last just over a year rather than almost two.
In the UK, house prices fell for the fifth month in a row in January. According to recent data from Nationwide Building Society, the price of an average property was down by 0.6% on December, adding that it would be ‘difficult for the market to regain momentum in the short term’. Affordability of mortgages remains challenging due to higher interest rates, while saving for a deposit has become more difficult as the rising cost of living has been eating into household budgets.
- US Initial Jobless Claims data released 9th February 1:30 pm.
- UK GDP (YoY, QoQ) data released 10th February 7:00 am.
The performance of each asset class is represented by certain Exchange Traded Funds available to UK investors and expressed in GBP terms selected by Copia Capital Management to represent that asset class, as reported at previous Thursday 4:30pm UK close. Reference to a particular asset class does not represent a recommendation to seek exposure to that asset class. This information is included for comparison purposes for the period stated, but is not an indicator of potential maximum loss for other periods or in the future.Open document settingsOpen publish panel