Magna Financial Market Report – January 24th 2025
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• Trump calls for rate cuts and reduces tariff pressure on China
• EUR rises as markets scale back expectations for rate cuts
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RECAP
Donald Trump grabbed the spotlight yesterday with two key points.
He shared plans to engage with Fed Chair Jerome Powell, advocating for interest rate cuts to reduce the financial pressure on American households.
In a separate interview with Fox News, Trump stated that he would prefer to avoid imposing tariffs on China, mentioning that he has had “good, friendly” talks with President Xi Jinping. These statements are contributing to the ongoing softening of the U.S. dollar.
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OUR SUMMARY
The EUR is ending the week on a strong note, bolstered by better-than-expected EU and German PMIs. This positive economic data has led to increased expectations for a more stable outlook ahead.
While markets are anticipating a 25bps rate cut from the ECB in next week’s meeting, there are growing concerns about inflation, which could prompt a reassessment of those expectations. A stronger economic outlook may also influence this shift in sentiment.
Today, the release of UK and US PMIs will capture attention, but the prevailing theme is expected to be a continued softening of the USD, following Trump’s comments from last night.
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HOW WE CAN HELP
Our team of currency experts are here to help you get more from your money when making international payments. We will work with you to understand your payment needs and offer specialised guidance on the best options available to you. Get in touch with Osman Hanif today on +44 (0) 20 3371 9200 or email osman@magnafinancial.com.
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