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June will be a month 'to remember" says BofA as central banks prepare to cut rates

Published 10/05/2024, 08:28 pm
© Reuters.

Analysts at Bank of America (NYSE:BAC) said June will be one "to remember" with key decisions for many central banks to come. 

The investment bank noted that this week was rich in central bank surprises, with the Riksbank deciding to take the lead and cut rates and the Bank of England showing a lot more confidence in inflation going in the right direction than they had expected. 

"In a way, we got a glimpse of what June - with key decisions for many central banks - would look like for markets," said BofA. 

They add: "All together, it seems we may be heading into one of the most important months for markets in a long with key decisions ahead for many central banks. This may prove to be a June to remember."

For the BoE, BofA said they took another decisive step towards a first cut and "all meetings are live from here."

"BoE shows a 'structural' dovish bias, but we still think wages will be stickier. Our call remains for a first cut in August," states BofA. 

According to BofA, the focus in Europe will be on the UK labour market data for March next week. The German ZEW should continue to improve in May, and the preliminary 1Q GDP release for the Euro area will provide more insights on growth development across the region.

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