As we approach the week of February 10, 2025, financial markets and policymakers are keenly awaiting significant economic indicators from both sides of the Atlantic. The United States is set to release its Consumer Price Index (CPI) data, while the United Kingdom will unveil its Gross Domestic Product (GDP) figures. These releases will provide critical insights into the current economic climate and inform future monetary policy decisions.

United Kingdom’s GDP

Recently, the Bank of England (BoE) implemented its third interest rate cut within six months, reducing the benchmark rate to 0.5%. This decision reflects concerns over the nation’s economic momentum, as the BoE halved its 2025 GDP growth forecast from 1.5% to 0.75%, anticipating a modest recovery in subsequent years. 

The BoE’s cautious stance underscores the challenges facing the U.K. economy, including subdued consumer spending and external uncertainties. The forthcoming GDP data will be pivotal in assessing the effectiveness of recent monetary easing and shaping future policy directions.

U.S. Inflation

In the United States, the Federal Reserve has maintained a vigilant approach toward inflation. The upcoming CPI release is expected to show a 0.3% monthly increase, following a 2.9% year-over-year rise in December 2024. 

Recent statements from Federal Reserve officials have highlighted concerns about potential inflationary pressures, especially in light of ongoing trade tensions and tariff policies. The central bank’s dual mandate of promoting maximum employment and stable prices necessitates a delicate balance, and the latest inflation data will be instrumental in guiding future interest rate decisions.

EURUSD – Technical Analysis

Although a higher-than-expected U.S. inflation print could encourage the Federal Reserve to maintain rates at restrictive levels for a longer period, any indication of a potential rate cut timeline could fuel a rally in EUR/USD. Markets tend to price in future expectations, so even a hint of dovishness from the Fed could weaken the dollar, pushing EUR/USD higher. From a technical perspective, the pair is currently forming a zigzag corrective pattern, suggesting a potential breakout to the upside. If the structure holds, EUR/USD appears poised to enter an Elliott Wave Theory’s wave ((iii)), targeting higher Fibonacci levels as bullish momentum builds.

Anticipated Economic Data Releases

• U.S. Consumer Price Index (CPI): Scheduled for release on February 12, 2025, at 8:30 AM Eastern Time, the CPI is projected to increase by 0.3% month-over-month.
• U.K. Gross Domestic Product (GDP): The Office for National Statistics is set to publish the latest GDP figures on February 13, 2025. Analysts anticipate modest growth, reflecting the broader economic challenges highlighted by the BoE.

Conclusion

The forthcoming economic data from the U.S. and the U.K. will offer valuable insights into the health of these economies and the effectiveness of recent monetary policies. Stakeholders should monitor these releases closely, as they will have significant implications for financial markets and future policy decisions.