Market Drivers – European Session 17-3-2022

In its latest monetary policy announcement, the Bank of England (BoE) opted to raise the benchmark UK interest rate by a further 25bps to 0.75% from 0.50%, as had been widely expected. GBP’s kneejerk reaction was to drop sharply as a result of only eight on nine Monetary Policy Committee (MPC) members voting to raise interest rates (versus expectations for nine). MPC member John Cunliffe voted to leave rates unchanged at 0.50%.

There were 214,000 initial jobless claims in the US in the week ending on 12 March, less than the 220,000 expected and below the week prior, when there were 229,000 claims (revised up from 227,000), data published by the US Department of Labor (DOL) revealed on Thursday. The four-week moving average of initial claims thus fell to 223,000 from 231,750 the week before.

According to a report from the Federal Reserve Bank of Philadelphia released on Thursday, the headline Manufacturing Activity Index of the Manufacturing Business Outlook Survey rose to 27.4 in March from 16.0 in February. That was significantly better than the expected decline to 15.0.