The first ECB Governing Council policy setting meeting of 2025 saw the central bank cut interest rates. It reduced them by 25bps, with the Deposit rate lowered to 2.75%, while the Re-fi rate was decreased to 2.90%. This marked the fifth 25bps rate cut since the ECB commenced its easing cycle in June of last year. Today’s decision by the ECB to cut rates was unanimous.

The first meeting of the US Federal Reserve Open Market Committee (FOMC) for 2025 saw the central bank leave policy on hold. The target range for the Fed funds rate was maintained at 4.25-4.50%. The decision by the FOMC to leave rates unchanged was unanimous and very much in line with market expectations.

The manufacturing PMI fell to 49.1 in Dec, indicating a slightly sharper pace of contraction in the sector. The services PMI edged down to 57.1 in Dec, consistent with a slower, albeit still strong pace of expansion. The construction PMI printed above 50 in Dec, rising to its highest level since April. Mortgage approvals rose by 6.5% YoY in the 3mths to Nov. 

Historic FX & Interest Rates for 2024 ....

World economy continues to exhibit uneven growth. US remains an outperformer, with signs of weakening growth in the Eurozone. Core inflation remains sticky in most markets, particularly the UK, with risks still tilted to the upside for inflation.

The November meeting of the Bank of England’s Monetary Policy Committee (MPC) saw the central bank lower Bank rate by 25bps to 4.75%. This was the second rate cut from the Bank of England (BoE) in three meetings. Subsequent to this, the BoE cuts rates for the first time in August, following its rate tightening cycle, which had been in place since the end of 2021. 

Growth in Ireland’s key trading partners uneven, geopolitical risks to the fore. Irish economy expected to grow at a moderate pace in the coming years. Households remain cautious in spending patterns. US dollar dominance tested by macro trends.

Renewed momentum in Irish residential property prices...

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