The pound recorded a positive day against the euro and the US dollar as recent jitters in global financial markets eased across Tuesday.
A rebound for gold and silver after a dramatic sell-off helped steady broader markets, where strong results from the AI sector also lifted the mood (although not for software companies). Overnight, the US government’s partial government shutdown ended after just four days, although the $1.2 trillion agreement still only secures funding for the Department for Homeland Security up to next Friday, setting the scene for another political showdown.
Yesterday proved to be light on economic data after the partial US government shutdown forced the postponement of the JOLTs job update. This afternoon’s services PMI from across the Atlantic will be an interesting one after strong manufacturing output in January.
French consumer price inflation fell to an annualised 0.3% in January, significantly undershooting forecasts ahead of the eurozone’s unified read later this morning.
Staying in France, months of highly politicised wrangling in French parliament have finally yielded a government budget. It was a document that felled two prime ministers, but Sebastian Lecornu (who himself was forced to resign before returning to his post) could eventually claim success thanks to a compromise to suspend plans to increase the retirement age from 62 to 64.
Government borrowing costs climbed in the eurozone and the UK on Tuesday. This was partly the result of recent inflation data, which supported the view that interest rate cuts might be few and far between this year, as well as significantly heightened sovereign spending in Germany’s case.
Santander is launching 98% mortgages in an effort to capture the first-time buyer market. “My First Mortgage” offers a five-year loan at a fixed rate of 5.19%, the caveat being the offer only applies to buyers looking to purchase a house and excludes customers in Northern Ireland.
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