Cooling inflation, economic support and interest rate cuts | The Week in Markets

Chris Leyland, Head of Investment Strategy and George Bell, Portfolio manager, look at the European Central Bank and their decision to continue the interest rate cutting cycle after inflation came in at 1.7%. This tracks with market expectations as the eurozone economy was showing signs of stagnating so the hope will be that reduced borrowing costs will support growth. In terms of inflation, a similar story is seen in the UK with headline inflation falling to 1.7%, below the Bank of England’s target for the first time since 2021. With a demonstrated resilience in economies and inflation coming down, we will see further rate cuts before Christmas.