Good morning
I try not to comment too much on general news as this is something you can all find online. However it is impossible not to comment when 19 young children are killed in a senseless shooting in a US school. It is impossible to put any feelings into words to do this tragedy a justice. This is the second mass shooting in the US in less than two weeks
We saw GBP fall sharply yesterday after the PMI numbers, it has since managed to regain a lot of its lost ground both against USD and EUR, with GBPUSD now 1.2550 and EURGBP 0.8520 (GBPEUR 1.1740). EURUSD meanwhile spent much of yesterday above 1.0700 after some hawkish talk from ECB officials but has this morning slipped back to 1.0680, I’m not sure if that is down to Lagarde comments or the ECB financial stability review.
RBNZ raised rates 50bps to 2% as widely expected but their comments surprised on the hawkish side, pushing NZD higher. NZDUSD traded up from 0.6430 to 0.6500 while AUDNZD fell from 1.1015 to 1.0930. RBNZ said they see rates now at 3.25% by year end and peaking at 3.95%, up from 3.35%.
Japan and surrounding areas are hotting up with both US and South Korea, and China and Russia, conducting military drills in the area, while North Korea has test-fired three ballistic missiles. George Soros speaking at Davos said world war three may already have begun and that civilisation may not survive, blaming the regimes of Putin and Xi of endangering the world.
I went to visit a client yesterday and by chance the stop I needed was on the new Elizabeth line. I thought I’d try it out and I have to say it was pretty exceptional. The trains were running one every five minutes, I’ll be amazed if they can keep that up, for the short time I was on board I have to say the carriages are a pleasant place to be. The stations are quite stunning, a real sign of what a modern transport system can look like. Just be warned, the trains are very long at around 200 metres, so if you are getting on at one end and the exit you need is at the other end, you’ve got quite a walk on your hands. Not only that but the station entrances at Moorgate and Liverpool Street are connected and serve the Liverpool Street station, so it’ll take a while to get to the platform itself. However from an initial look, it seems to be a huge success and if I lived out in Reading or maidenhead, or Breentwood of Shenfield, I’d be over the moon to have such a train taking you into the City each day.
Finally, my U15s play yet another double header this evening. We need just one point to secure the league title, to go along with our cup win a couple of weeks ago. I have every reason to be confident, but I’m sure I said that last week before our weekend matches, where with two draws we managed just two points out of the six available. I’m actually looking forward for the season to be over now, its dragging on a bit, but I’m sure once we secure the point needed I’ll feel a bit more comfortable.
It’s a fairly light calendar today although we have several central bank officials speaking. FOMC minutes later in the day, may give us an idea on where and when Fed thinks rates could peak, also look for clues as to balance sheet reduction. I’m wondering whether we’ll see a bit more USD strength as we move through the week.
- 09.00 ECBs Lagarde speaks
- 09.00 ECB financial stability review
- 10.45 ECBs Lane speaks
- 12.05 BoJs Kuroda speaks
- 13.30 US durable goods
- 17.15 Feds Brainard speaks
- 19.00 FOMC minutes