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  • richard evans

Survived the first quarter.....

Good morning

Welcome to the end of the month and indeed the end of the first quarter of the year. That’s gone pretty quick. It really feels as though we have got away with what could otherwise have been a pretty horrific time. Global stocks are generally in positive territory and futures prices suggest we’ll have more upside when markets open.

The US dollar weakness continues, GBPUSD actually traded up to 1.2420 overnight, EURUSD to 1.0925, both are off those highs, now 1.2380 and 1.0895 respectively, but still at the upper end of recent ranges. In GBPUSD, the 1.2440 area has been tested a few times since mid-Dec and has held each time, we need to go back to June 2022 to see higher levels. An important area to watch. This mornings very slightly improved UK GDP has had little impact on the markets.

EU inflation out this morning, a strong reading could push EURUSD towards 1.10 but that area is likely to remain out of reach for now. As always around month-end we hear of the potential for erratic flows which could perhaps increase the chances of some volatility.

South Africa surprised the markets yesterday with a 50bps interest rate rise, against an expected 25bps, as they upped their inflation forecasts. This sent ZAR higher with GBPZAR trading sharply lower from around 22.35 to 22.00, currently 22.10. The vote was a close 3-2 in favour of 50bps, far from a unanimous decision.

Finland has gained NATO membership as Turkey votes in favour of admitting the country to the pact. This comes as reports Russia is looking to draft another 150,000 soldiers ahead of what must surely be another major push in Ukraine although some think they will be used simply to hold ground in East Ukraine rather than make further gains. Some reports put that number up around 400,000.

In other news, Trump is making the headlines as he becomes the first ex-US President to face criminal charges. They stem around his hush-money payment to Stormy Daniels. The payment of $130,000 was allegedly to cover up an affair back in 2006 and is not itself illegal. However Trump put the payment down to legal fees. Falsifying business accounts is a criminal offence in New York, and there is talk he is facing for than 30 charges for business fraud so one thinks there must be more to this than just a $130k payment.

I am not defending Trump, but this is surely pretty small-fry from people who I think would try to find anything to charge Trump with. Therre must be many other businessmen and politicians who have done the same and got away with it. Doesn’t make it right I know. Ms Daniels had signed an NDA which she then broke. I’m not sure what the law says about that.

Sticking with the US and some legal issues, Disney and Florida Governor De Santis have been having disagreements with De Santis determined to gain more control over the Disney theme park areas which have their own tax regime. De Santis appeared to be winning until it transpires Disney have used a legal clause which dates back to 1692 in an agreement which extends its terms until ’21 years after the death of the last survivor of the descendants of King Charles III’. That will obviously be some time. De Santis is not impressed and has vowed to seek a way round the clause, Disney say it is entirely legal. Conspiracy theorists would have a field day if anything happens to members of the Royal family from now on.

Have a splendid weekend. Looks like we’ll have to put up with this rain for another day or two but its possible Monday brings some sunshine with it. For those commuting, kids are now on school holidays so roads and trains should be quieter for the next couple of weeks.

- 10.00 EU HICP, unemployment

- 13.30 Core PCR, personal income/spending

- 13.30 CAD GDP

- 14.45 US Chicago PMI

- 15.00 US Michigan sentiment survey

- 20.05 Feds Williams speaks

- 22.45 Feds Cook speaks

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