The European Central Bank is set to cut interest rates later this week, its first rate cut since 2019.
According to reports, the decision comes as inflation in the Euro economic area has begun to move closer to the bank’s 2% target.
Last month saw consumer prices drop to 2.6%, with a print of 2.9% for core inflation for the same period.
Following a post-pandemic surge in the cost of goods, the ECB, along with other major central banks, hiked rates in a bid to slow down consumer spending.
Should the cut occur, the bank will become the first major central bank to adjust its policy since the start of the tightening cycle.
ADP Private Payrolls Weaker Than Expected
Private payrolls in the United States rose by less than expected in May, according to data released today.
Figures from the ADP monthly jobs report showed that companies added 152,000 jobs in May.
This was lower than the anticipated addition of 175,000 jobs and worse than April’s reading of 188,000.
Wednesday’s number comes ahead of this week’s non-farm payrolls, which are expected to show an addition of 185,000 jobs.
US Service Sector Growth Surpasses Forecasts
The growth rate in the services sector in the United States outperformed expectations last month, data today has shown.
According to the Institute for Supply Management, its non-manufacturing purchasing managers index rose to 53.8 last month.
The reading was the highest increase since August 2023, surging up from 49.4 in April, moving beyond analyst expectations of 50.8 in May.
This could further delay a possible Federal Reserve rate cut, as it signals economic resilience despite higher rates.
XAUUSD rose by $30 following the data release.
In this business, if you’re good, you’re right six times out of ten. You’re never going to be right nine times out of ten.
peter lynch
