Could we see a positive end to the week?
Both Feds Powell and Daly repeat that 50bps rises at the next two meetings is appropriate, the latter making clear 75bps is not really a consideration. US markets ended mixed but Asian markets ended the week on an optimistic footing with most indices posting gains, helped in no doubt by the idea that Fed will not necessarily look for steeper interest rate rises.
GBPUSD 1.2225, perhaps a little calmer although don’t forget next week could have a lot more talk on the Northern Ireland protocol, unlikely to offer much support I fear. We also hear of plenty of interest to sell GBP on rallies which is likely to cap the upside.
EURUSD at 1.0405 with some attention on mid 1.03s being near 20 year lows. EUR failed to hold recent gains against GBP, EURGBP now 0.8515 (GBPEUR 1.1745). This is more to do with EUR weakness than particular GBP strength mind you.
Bitcoin traded down to $25,500 yesterday but has recovered to $30,000, the panic selling seems to have run its course, for now, perhaps contributing a little to the general positive risk sentiment. Gold slipped a little lower, now $1825 after finding support around $1810.
USDCNY fixed 6.7898 but has traded above 6.8100 for the first time since Q3 2020 amid reports of panic buying in Beijing on rumours of a lockdown there, which is being denied. Shanghai still not open, some talk from officials suggests it will be another week before any restrictions can be lifted. Meanwhile Hong Kong bought HKD aggressively again to keep USDHKD within its peg.
Elsewhere in the world, If you thought interest rates were high, I see Argentina raised rates 2% to 49%, the fifth rise this year in an attempt to control inflation. Finland is looking to join NATO which is hardly a surprise given the threat posed by Russia although Russia will no doubt call this an act of aggression.
The doom and gloom I seemed to feel yesterday was lifted by Spurs beating a rather undisciplined Arsenal pretty convincingly. I know there are a few Arsenal fans on here so I’ll just say it evens the season up after Arsenal beat Spurs back in Sept. Spurs Champions league chances remain alive but fourth place is still Arsenals to lose.
This weekend my U15s actually play in two cup finals, one Saturday and one Sunday. Both are important, the Saturday is more for players who don’t get to play regularly on Sundays, the Sunday final is the more prestigious where we play a team from the division above us. I am already nervous. We’ve had such a terrific season so far it would be wonderful to come away with some silverware. I’ve had to leave some players out of the teams although everyone in the squad will get to play in at least one final. The hardest part is choosing which of my two assistants I will take to the dugout with me Sunday, the league insisting only two people can be there. A bit mean for kids football given the hard work all the volunteers put in. Lets hope the disappointment is outweighed with a win. I’ll let you know Monday.
- 10.00 EU industrial production
- 13.30 US import, export prices
- 15.00 US Michigan sentiment survey
- 17.00 ECBs Schnabel speaks
- 17.00 Feds Mester speaks
- 20.30 CFTC position data
- 03.00 China retail sales, industrial production