The euro held above the $1.08 mark, remaining close to its strongest level since late August, as data indicating a slowdown in the US inflation rate and a surge in jobless claims hinted that the Federal Reserve has likely concluded its rate hikes. Concurrently, Eurozone data confirmed a sharp slowdown in year-on-year inflation, reaching a low not seen in over two years in October. Market expectations reflect an anticipation of over 100 basis points in cuts to US interest rates next year, along with approximately 100 basis points in cuts to ECB rates by the end of 2024. This contradicts ECB President Christine Lagarde’s remarks from last week, where she indicated that interest rates would remain restrictive for several quarters.
