Good morning
I’m a little late this morning as I got caught up in the excitement of the Olympic diving, where Tom Daley and Matty Lee won gold in the 10 metre competition, beating fierce competition from the Chinese who, despite a stunning sixth dive, were unable to get enough points to overtake the British pair. I’m not a huge diving fan but I am always impressed with any sportsman or woman who can be at the top end of their sport for so many years, Daley has certainly managed that since his Olympic debut back in 2008.
UKs Covid infection rates seem to be on the decline, the first time this has happened outside a lockdown period which would appear to be very positive step although perhaps a little too early to get too excited as the data does not include the week since the UKs restrictions were eased almost totally. I do feel that the Euros had a hand in higher infection rates as well with indoor gatherings for the latter stages getting more and more people together, perhaps the effects of that are tailing off as well.
As you’d expect GBP hasn’t been hugely moved by this news as yet. GBPUSD now 1.3770, heading towards last weeks high just around 1..3790. Perhaps BoEs Vlieghe who speaks later today can say a few words that will give GBP a boost although he does have just one more meeting in August to go before he is replaced on the monetary policy committee. EURGBP currently 0.8570 (GBPEUR 1.1670).
The FOMC rate meeting on Wednesday could well be a highlight of the week as we look for signals on tapering discussions and views on inflation, with potentially hawkish comments coming from those, perhaps offset with caution over ongoing Covid infections. Some talk that USD has made gains in 9 out of the last 15 August, that’s not really convincing enough for me to pay much attention to it.
Elsewhere, London saw some flooding again over the weekend after heavy rain, Germany have floated the idea of mandatory vaccinations and tough restrictions on unvaccinated people, China and US officials are meeting, no great headlines from that, while some Asian markets have traded lower after China introduced restrictions on firms offering education and tutoring services.
- 09.00 German IFO
- 12.00 BoEs Vlieghe speaks
- 15.00 US new home sales
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