Risk appetite improves following significant uncertainty/volatility in the aftermath of “Liberation day” However, there is still limited clarity on the ultimate landing zone for US tariffs. Market attention also focused on US fiscal & monetary policy, as well as geopolitical tensions Fed on hold for now. ECB near the end of its cutting cycle. BoE retains an easing bias. The dollar has weakened further in recent weeks. Euro likely to hold its gains, but high uncertainty still due to the evolving US policy landscape.

As we reach the halfway mark of 2025, the Irish residential property market continues to be defined by a shortfall in supply. The CSO completions data, which is the official measure of new supply indicate, a disappointing performance over the last year from the residential construction perspective.

The manufacturing PMI stayed firmly in expansion mode but eased to 52.6 in May. Traditional industrial production rose by 0.9% in the 3 months to April but were down 0.7% Year on year. The service. PMI increased to 54.7 in May, consistent with a sharper pace of expansion in the sector. The CSO services index was up by 6.3% in the 3 months to April.

The June meeting of the US Federal Reserve Open Market Committee. (FOMC) saw the central bank leave policy on hold. The target range for the Fed funds rate was maintained at 4.25-4.50%. This represented the 4th meeting in a row where the Fed left policy unaltered and was very much in line with market expectations.

The June meeting of the Bank of England's Monetary policy committee (MPC) saw the central bank leave the Bank rate unchanged at 4.25%. This followed a 25bpd reduction in May. Today's decision for unaltered rates was very much in line with the market expectations. So far in the current easing cycle, which began in August last year, the BOE has caught a total of 100bps.

The ECB's governing council meeting for June saw the central bank lower interest rates for a fourth consecutive time this year. It's once again reducing them by 25bps, With the deposit rate lowered to 2.00%., while the Re-fi rate was decreased to 2.15%. This Marked the eight 25bps rate cut since the ECB started its easing cycle in June 2024.

The global economy entered 2025 in good shape, with indicators pointing to stronger growth in the Eurozone and UK, and continued robust, yet moderating growth in the US. However, the uncertainty created by the imposition of US trade tariffs, followed by partial 90-day delays, has created volatility in financial markets and concern in the real economy.

Historic FX & Interest Rates for 2024 ....

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