No love for Djokovic in Australia
US equities fell yesterday, with tech stocks hit harder than most as Fed minutes came across as more hawkish than expected. That sentiment carried through to the Asian session while US dollar strengthened.
Most Fed members think the case for a rate rise will be met relatively soon while risks to inflation are firmly to the upside. Omicron may offer a bit of uncertainty but the overriding theme was the potential for earlier and faster paced rate rises. No surprise US dollar pushed higher, helped also by a much stronger than expected ADP employment number which has prompted some upside revisions to forecasts for Fridays nonfarm payroll data.
ECBs Kazak did his best to respond, saying ECB will act if inflation outlook picks up, adding that a rate rise in early 2023 is possible. His comments did little to help the single currency, EURUSD still at 1.1300. GBPUSD hit close to 1.3600 yesterday but has traded almost exactly 100 pips lower since the Fed minutes, ticking below 1.3500 briefly this morning, currently 1.3510. GBP took another look at the 1.2000 area in GBPEUR (EURGBP 0.8335) but didn’t quite have the legs and currently trades at 1.1950 (EURGBP 0.8370).
Meanwhile the UK are adjusting their rules over PCR testing in order to ease the burdens placed on the system. That isn’t to say it will all be easy but there are some circumstances where PCR tests will no longer be required. Seems inbound travellers will benefit, my only concern is that we then rely on the travellers to test themselves which can easily be manipulated, plus we perhaps fail to spot new variants. As always, we are placing a good amount of reliance on vaccinations.
Australia have responded to public outcry as tennis player Djokovic sees his visa cancelled on arrival in Melbourne and was taken to a quarantine hotel with the idea that he will be deported. A court is set to decide his fate early next week. It is thought he had been granted an exemption to play in the Aussie open despite his lack of evidence of his vaccination status. Aussie citizens have, like many others around the world, had to live with strict living and travel restrictions and to see what some regard as a privileged individual getting special treatment was a little too much to bear.
Djokovic won’t be happy but the public have spoken. If public opinion has any standing in the UK, I wonder whether Tony Blairs recent knighthood is at stake after a petition against his award reaches over 750,000 signatures.
- 10.00 EU PPI
- 13.00 German CPI, HICP
- 13.30 US initial jobless claims, goods trade balance
- 13.30 CAD trade balance
- 15.00 US services ISM
- 23.30 Japan Tokyo CPI, household spending