FX DAILY REPORT – 17 January 2025
- The Rand opened weaker against all the majors this morning.
- Uncertainty surrounding the Trump administration’s new policies has tempered expectations for a Federal Reserve rate cut, despite easing U.S. inflation reflected in the Consumer Price Index (CPI). Investors are closely watching how these policies will be implemented and their potential impacts as Trump officially assumes office on Monday morning. This has led to a slight strengthening of the U.S. dollar.
- Eurozone inflation data is set to be released today, following yesterday’s German CPI report, which showed a slightly higher-than-expected growth of 0.5%. Investors have already factored in a 25-basis-point rate cut for the January meeting, with an additional three 25 basis point cuts anticipated by the middle of the year. This will likely limit EUR gains.
Todays Events:
- UK Retail Sales (YoY) at 9:00 – Expected to increase to 3.3% compared to previous 0.5%. A higher-than-expected result can be seen as positive for the GBP.
- Eurozone CPI inflation at 12:00 – Expected to increase to 2.4% compared to previous 2.2%. A higher-than-expected result can be seen as positive for the EUR.