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  • richard evans

Forget inflation, cheaper wine is on it's way!

Good morning

Firstly, an apology. Something isn’t right with my email. I can send emails but incoming emails don’t show up in my inbox. I thought it was a bit weird that I didn’t seem to have many yesterday, I have now logged in a different way and see a few messages from some of you that I have not responded to which I’ll get to in a bit. Attempts to fix it this morning have meant I’m running a bit late.

It was another decent day for US stocks yesterday although Asian markets are generally lower overnight on news the potential sale of Evergrandes property management arm has fallen through. There were no surprises form central bank speakers and nothing really new in the Feds Beige book. Feds Quarles toed the line on inflation and rates although did add that if inflation is still around4% in the spring, rate expectations could change.

GBPUSD back above 1.3800 after a brief test below there earlier this morning, while EURGBP sits at 0.8425 (GBPEUR 1.1870). EUR struggling to find support on diverging rate expectations between Fed, BoE and ECB.

USDCAD moves lower helped in part by ongoing USD weakness but also by higher than expected Canadian inflation numbers yesterday. USDCAD traded as low as 1.2290 after the release, although this move was short-lived, USDCAD now at 1.2330.

Bitcoin hits a record high above $66,000 as demand picks up following a new ETF launch. I still struggle to see the sense in Bitcoin, I’m not sure what its purposes really tries to be. It hardly removes currency volatility. Anyway I was one of many around when it was trading at 10 cents and I didn’t buy any then. I had my chance, that’s for sure. I haven’t seen how El Salvador have been getting on using Bitcoin as legal tender, but I did read that in Venezuela residents have taken to paying for goods and services in gold.

Speaking of currency volatility, keep your eye on Turkish Lira at midday today when the Turkish central bank is likely to cut rates, by 50-100bps. USDTRY is currently at 9.25.

UK retail sales out early tomorrow morning. Expecting to see a rise MoM but a dip on the YoY figure. Perhaps of more importance, I see the UK have agreed a trade deal with New Zealand meaning some products from NZ will be cheaper. I must say I am particularly partial to a drop of NZ Sauvingnon Blanc, Tesco do some particularly fruity ones which make good guzzling wines. OK, I know that’s not supposed to be what wine is all about, but there’s nothing wrong with a cheap, easy drinking crisp white wine on a summers day. Or a winters day, or any other season.

Earlier this week I mentioned Covid and how it hadn’t been quite as high profile in the news. Since then all I have seen is Covid news, and most of it bad. Higher infection rates, worrying variations, talk of new restrictions and travel bans. Its not looking good. I did see Sajid Javid saying they have plenty of booster jabs available but not enough arms. Well I know many people waiting for a booster who have not yet been called. I had my jabs quite early so I’m expecting a booster in the first couple of weeks of November. Having seen the effects of Covid first-hand, I will in the queue at the earliest opportunity.

I’m currently feeling pretty pleased with myself. My central heating programmer has been turning off by itself recently, meaning no hot water or heating when we expect it. I purchased a new programmer and fitted it myself yesterday. This is a job I’d normally call an electrician out to do. It is amazing what you can do when you put your mind to it, but I have to say I was greatly helped by YouTube where I actually found a video of a guy replacing my old unit with the very same unit I purchased. Incredible. All I need to do now is learn how to fix a rather badly leaking roof…..

Finally, thanks for comments on the Heat Pumps yesterday. General consensus seems to be that unless you own a modern, totally insulated and draft-free property, a heat pump will not be sufficient alone to heat your house through the winter. I still like the idea of them, particularly with natural gas prices as they are, but they are not quite up to speed yet. No one has yet said anything to convince me otherwise.

- 12.00 Turkish rate announcement

- 13.30 US initial jobless claims, philly fed survey

- 13.30 CAD new house prices

- 15.00 US existing home sales

- 15.00 EU consumer confidence

- 20.00 RBAs Lowe speaks

- 23.00 AUS commonwealth bank PMIs

- 00.01 UK GfK consumer confidence

- 00.30 Japan CPI

- 07.00 UK retail sales

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