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  • richard evans

A good way to start the week

Good morning

What a terrific weekend. It is incredible the difference a spell of hot weather makes to lift the general mood. Stocks also seem to be enjoying moment of optimism, with most Asian stocks higher overnight and futures markets pointing to a positive start in Europe. The US dollar is down, GBP and EUR make gains as a result, Gold is back up to $1850

China and Hong Kong are about the only ones to show losses, not helped at all by reports that Beijing has recorded a record number of new Covid cases and a Shanghai district has ordered that all shops be closed and for residents to stay home, even though zero community cases were reported.

GBP has started the week well, GBPUSD trading up to 1.2570 this morning although currently back at 1.2550, still quite a turnaround from those lows around 1.2150 a week or so ago. GBP is also making some gains against EUR, with EURGBP at 0.8440 (GBPEUR 1.1850)

ECBs Lagarde has signalled that July could well see a rate rise although it is not likely to be as much as 50bps. Other EU nations talk of the need for fiscal discipline and reducing levels of debt. EURUSD currently 1.0600 with eyes on the early May highs around 1.0640.

NZD is performing well ahead of RBNZ rate announcement this week, where a 50 bps rate rise is widely expected. NZDUDS is up at 0.6465, highest levels since early May, while AUDNZD is down at a critical support level of 1.0980, that level having held since AUD rallied after RBA rate rise back on 3rd May.

Labour’s Albanese has been announced as Australias new Prime Minister. I had thought AUD could lose a bit of ground on this result but it was widely expected and market impact is minimal.

I’ve been reading about this Monkeypox outbreak, with 20 cases so far confirmed in the UK but with this number expected to rise. The government has said anyone at risk should isolate for 21 days. There doesn’t seem to be a concern that it will spread widely or rapidly, but of course after Covid we are all on higher alert for outbreaks of illnesses. I say ‘after Covid’, I know it has not gone away but for the second or third week I cannot name one person with the virus.

This week sees the opening of Crossrail, or the Elizabeth Line as it is now called. I have to say I am quite looking forward to taking a trip on it, if only to see whether it runs as well as we have been told. It is late to open, I remember 2018 was the original opening date, but it really is quite a feat of engineering, sometimes they were digging just inches from other underground train lines in London, and I read that the stations themselves are quite spectacular. It opens just at a time where working from home has become popular but that hasn’t stopped house prices along the line seeing huge increases. It will be another year before it is fully operational.

As that line opens, spare a thought for our friends north of the border in Scotland, who see a new timetable on their train routes which is bordering on criminal. Services have been greatly reduced due to staff shortages, as has been pointed out there are very few services operating after 8pm. The remaining trsains has better run on time!

Anyway onto football, where I am pleased to see Spurs holding onto that fourth spot to get into the Champions League. As for my U15s, well we played two matches Sunday, needing just three points to secure the league title. We managed two draws, which means we still have one more point to get from our three remaining matches. We are certainly making hard work of it, but nothing good ever comes easy. We do however remain unbeaten in the league so far.

09.00 German IFO

11.00 German Buba monthly report

13.30 US chicago fed national activity index

17.00 Feds Bostic speaks

17.15 BoEs Bailey speaks

23.45 NZ retail sales

00.00 AUS S&P manufacturing, services PMI

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