The US Federal Reserve Open Market Committee (FOMC) meeting for October saw the central bank, as expected, leave its interest rate policy unchanged. The target range for the Fed funds rate was maintained at 3.75-4.00%. The decision to leave rates unaltered was not unanimous, with the vote split 10:2, with the two dissenters (Cook and Hammack) in favour of a 25bps rate hike.

Irish manufacturing activity remained strong in September, with the PMI edging up to 55.5 as output and new orders continued to grow, including export orders. Traditional industrial production also strengthened, rising 4.4% in the three months to August and 0.8% year-on-year.

The October meeting of the ECB ’s Governing Council saw the central bank leaves its key interest rates unchanged. The deposit and refi rates were maintained at 2.50% and 2.65%, respectively. This was very much in line with expectations. The most recent policy change from the ECB was at its previous meeting in September, when it hiked rates by 25bps for a second time this year (previous hike occurred in June).  

The November meeting of the Bank of England ’s Monetary Policy Committee (MPC) saw the central bank hike the Bank rate by 25bps to 4.00%, as expected. It marks the first rate increase in the UK since August 2023. In the six successive meetings prior to today, the central bank had left rates unchanged. Once again, the decision by the BoE was not unanimous.

• Economic picture has been robust in the face of geopolitical shcoks, but ongoing energy shocks brings risks to the outlook
• US economy continues to outperform, with Eurozone and UK dented by higher energy prices and policy uncertainty

Historic FX & Interest Rates for 2025

The Irish residential property market remains defined by tight supply as 2025 draws to a close. However, over the course of the year, there have been some encouraging signs in the suppy dynamics, albeit the outlook remains challenging. 

This Budget is set against an uncertain economic backdrop so far this year. GDP growth was robust in the early part of the year but has since moderated. The Chancellor had committed to not raising taxes materially further following last year’s hikes to national insurance (NI) on employer contributions, which among other measures raised £40bn. While the tax rises are largely to fill the hole in the fiscal rules, there are also net spending increases in the budget.

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