The Paris Bourse began the session lower on Thursday morning, following last night's cautious statement by the US Federal Reserve regarding interest rate cuts. The CAC40 index fell by 0.7% to 7810 points.

As expected, the Fed left rates unchanged at the end of its two-day monetary policy meeting, but somewhat dampened investors' expectations of monetary easing.

The Fed's new interest rate projections - the so-called "dot plots" - now show only one rate cut in 2024, compared with three so far.

Of the 19 members of the Monetary Policy Committee (FOMC), four expect no rate cuts this year, seven expect one and eight expect two.

"This FOMC is not really a game-changer (...) but it is a little more hawkish than expected", comments Bastien Drut, head of strategy and economic research at CPRAM.

Powell is making an effort to shift the Fed's policy focus away from price stability and towards the labor market", adds the economist.

But the more restrictive stance of US monetary policy has not deterred investors from continuing to invest heavily on Wall Street.

In the wake of the Fed's statement, the Nasdaq set new records on Wednesday evening, still buoyed by continued gains by Apple and Nvidia, among others.

Traders shrugged off the Fed's statements to focus on the easing of inflation, all the more so as the day's indicators highlighted an easing of upward pressure on prices.

Investors' attention will now turn to US producer prices, due to be published at 2:30 p.m. at the same time as jobless claims figures.

The session promises to be sparse in macroeconomic indicators on the Old Continent, but the publication of industrial production in the eurozone and inflation in Spain will nonetheless enliven the morning.

In April 2024, seasonally-adjusted industrial production fell by 0.1% in the eurozone and rose by 0.5% in the EU, compared with March 2024, according to estimates from Eurostat, the European Union's statistical office.

Consumer prices in Spain, calculated on the basis of harmonized European standards, rose by 3.6% year-on-year in May, confirming an initial estimate provided at the end of last month.

Against this backdrop of falling inflation expectations, the search for yield continues to have the wind in its sails.

On the bond market, ten-year paper fell back below the 4.30% mark, to around 4.29%, the lowest since the end of March.

In Europe, the spectre of a chaotic situation following Sunday's election results has largely receded, and benchmark eurozone bond yields ended the day lower on Wednesday.

The yield on ten-year French bonds eased sharply back to around 3.14%, while the ten-year German Bund returned to 2.53%.

The dollar was buoyed by the latest forecasts from Fed officials, which removed the prospect of a rapid rate cut, allowing the euro to climb back up to 1.08 against the greenback.

The oil market remains bearish after figures from the Energy Information Administration (EIA) showed a rise in US crude inventories.

Brent crude is down 0.3% to $82.2 a barrel, as is West Texas Intermediate (WTI), which is down to $78.

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