Good morning
Well after a bit of action on Wednesday, Thursday was something of a damp squib in the currency world. GBPUSD had a brief dip to 1.2645 but had got back up to 1.2675 by the close, likewise EURUSD dipped to 1.0855 but had got back up to 1.0875, meaning GBPEUR was 1.1655 by the close having traded in a 15 pip range for most of the day. USDJPY pushed up off the Thursday morning lows around 153.60 to reach 155.50, dragging GBPJPY up to just short of 197.00.
Overnight USD strengthened just a touch, now at 1.2660, 1.0860 and 155.75 against GBP, EUR and JPY respectively. Fed officials generally offering the same theme, that is that while this weeks dip in inflation is welcome, it is not enough on its own to signal the time is right for rate cuts. More patience needed.
Some new mention of the potential for a BoJ rate rise in June has had very little impact on Yen. GBPJPY is up at 197.20 while GBPEUR is holding around 1.1655. ECBs Schnabel has said she still sees a June rate cut but the path beyond there is less certain. ECBs Kazaks seemed to suggest the meetings with updated forecasts are the ones to watch out for, June, Sept and December.
Xi and Putin have been getting closer as Putin visits Russia. Xi said China and Russia are ready to work together to uphold fairness and justice in the world, while Putin added the two nations were the stabilising factors in the international arena. I think they really believe what they are saying, which makes it all the more worrying.
We’ll have EU inflation numbers this morning which sounds interesting but is rarely a market mover, particularly as this is the second estimate and is likely to be the same as the first release. Other than hearing from
a few central bank officials there’s not a lot else on the calendar so there is a good chance we could have another quiet day in the markets.
With all of the bad news in the press, it is great to find something that brings a smile to your face. In this case it was a proper laugh. A video of two lads walking in Norwich after a night out a week or so ago, amazed by the Northern Lights, particularly pleased to have seen them as they’d not been visible during their trip to Iceland earlier in the year. They carried on walking, only to find the purple haze was in fact lights from a nearby Premier Inn. Their video has now been viewed millions of times, they really deserve a free night on the hotel chain for all the publicity they have created.
Now, if anyone has any little currency jobs they need doing, or questions to ask about FX but thought they were a bit daft, today could be a good day to direct them towards Mark. He’ll be in a great mood after Leeds trounced Norwich 4-0 to send them on their way to the play-off final. They will find out tonight whether they’ll face Southampton or West Bromwich Albion.
It’s a decent weekend for sports. The premier league will be decided this weekend. As a Spurs fan I hope we win to hold onto that fifth place, disappointed to have let the chance of fourth place slip away. I’ll be hoping Man City win the title, not because I really dislike Arsenal that much but the many people I know who are Arsenal fans will be mildly unbearable for a while if they were to win.
We also have what could be a great boxing match against Fury and Usyk. I’m intrigued enough to want to watch it, my problem with boxing is that it is always on so late. When they suggest it begins at 11pm, it is actually likely to start well after midnight. I need my beauty sleep these days. No such problem with F1. The Italian grand prix starts at 2pm on Sunday afternoon.
Still on sport, I see Schauffele scored a 62 in the PGA tournament at Valhalla yesterday. Anyone who knows anything about golf knows what an incredible achievement this is, particularly on the courses and tees they play. The course measures 7,609 yards, not far off 1.500 yards longer than mere mortals would normally play.
Looking ahead to next week, we’ll have inflation and retail sales from the UK, an RBNZ rate announcement and a host of important PMIs out of EU, UK and US. The BoEs Monetary Policy Report on Wednesday could be of interest as well.
I’m rather hopeful we’ll have some decent weather over the weekend. I really should give up looking at the forecast, it was supposed to rain all day yesterday here and we didn’t get a drop. I don’t have a great deal planned so I’m not really bothered, I’d like it to be over 20°c although I know that’s unlikely. All I really ask is for some decent weather for my golf weekend at the end of the month. Mind you, given I have played very little golf for a year now, it might not be a bad thing if we get rained off for a round or two! I’m certainly not expecting to score 62. Well, on the front nine perhaps!
Have a great weekend.
- 08.20 ECBs de Guindos speaks
- 09.00 BoEs Mann speaks
- 10.00 EU HICP
- 15.15 Feds Kashkari, Waller speak
- 17.15 Feds Daly speaks
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