Olli Rehn, a member of the ECB's Governing Council, stated last week that the slowdown in inflation, combined with the weak Eurozone economy, has led to increased expectations of a rate cut next month.

Meanwhile, Mary Daly, President of the Federal Reserve Bank of San Francisco, mentioned in an interview with Bloomberg TV that "It is time to start reducing interest rates, likely beginning with a 0.25% cut if inflation continues to slow down and the labor market maintains stable employment rates."

The violence between Israel and Hezbollah has not significantly escalated, allowing investors to ease some concerns over the conflict. However, Hamas has rejected Israel's new conditions for ceasefire negotiations, which means that the conflict remains ongoing.

Source: Fxstreet