The Paris Bourse was up on Thursday morning, following three consecutive sessions of losses due to the growing questioning of expectations of a more flexible monetary policy on the part of the major central banks. The CAC40 index gained 0.4% towards 7350 points.

The Paris market had once again ended in the red yesterday, closing down 1.1% at 7318 points after having broken the 7410, 7375 and 7340 support levels in turn since the start of the week.

Investors are adopting a cautious stance, while many monetary policymakers on both sides of the Atlantic are taking a more uncompromising stance on the possibility of loosening financial conditions.

Yesterday, market participants had to contend with the speech given by Christine Largarde, President of the ECB, on the sidelines of the Davos economic forum.

She dashed hopes of a rate cut in the spring, and instead spoke of a 'likely' rate cut in June.

In addition to statements by central bankers, better-than-expected data from the USA fuelled fears that interest rates would remain high for longer than expected.

Expectations of rapid monetary easing had already been undermined yesterday by comments from Fed Board of Governors member Christopher Waller to the effect that the fact that inflation was tending towards the 2% target should not precipitate any rate cuts.

These comments have influenced traders' expectations, with fewer and fewer expecting the US Federal Reserve to cut rates quickly.

The scenario of a fall in the cost of money is receding: the consensus, which stood at over 77% before the weekend, now stands at around 59% according to the FedWatch barometer.

The big question at the moment is whether 2024 starts with a logical hangover after an exceptional end to 2023, or whether we can expect a more difficult year ahead", summarizes Jim Reid, market analyst at Deutsche Bank.

This context of uncertainty on rates has had an impact on US ten-year Treasuries, which on Wednesday had their worst day since mid-December, with ten-year paper back above 4.10%.

The heaviness of the bond market is also amplifying in Europe, where the yield on the ten-year German Bund - the benchmark for the eurozone - is back above 2.30%.

It is possible that the indicators expected today in the United States, led by jobless claims, will influence expectations of future rate cuts.

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