They thought July was all over....it is now!
US GDP was surprisingly subdued yesterday, coming in at 6.5% against expectations of around 8.5%. US equities pushed higher and the dollar remained weak as risk sentiment improved. Overnight however a bit of reality set in and Asian markets dropped, the Nikkei down nearly 2% and US equity futures are lower, not helped by weaker Amazon numbers released after the market close.
German inflation surprised to upside yesterday, ahead of the Euro area release today. We also have EU GDP this morning, expected to show a QoQ rise of 1.5% and YoY above 13%. Whether these will disappoint in the same was the US data did yesterday remains to be seen.
Also remaining to be seen is whether GBPUSD can crack through 1.40 today. It is currently 1.3965, we did get up to 1.3980 yesterday afternoon but it failed to make further ground just as it did in late June.
We have had some mixed news on the Covid front. Reported UK cases remain in decline for whatever reason that may be, Aussie cases are lower but this is less surprising given they are in lockdown and have even deployed the army to the streets of Sydney to enforce the lockdown. Japan however extends the state of emergency over rising cases and China appears to have had an outbreak at Nanjing airport that has already spread to 15 cities. Plenty of talk of third Covid booster jabs given the growing idea that vaccines lose effectiveness after a few months, Israel have announced over 60s will get a third jab in an attempt to slow infections and I am sure the UK have plans to offer boosters after the summer. Still some people are refusing their first jabs, the US are even looking at offering $100 cash to encourage people to get vaccinated.
Despite Japans Covid problems, the Olympics is still going on and continues to surprise me. I’d never have thought I’d be interested in trampolining, but boy do they bounce high. And I’d always thought BMX riding was just adults messing about on kids bikes. Turns out it’s a fast, dangerous and tiring sport. Just watch the footage of GBs Shriever after her win to see how much effort she had put into the race.
The athletics has started, I think we have some longer distance races today. I remember reading something years ago that suggested events like 10,000 metres just wasted track time given all they do is jog round until and then sprint the last 200 metres. The suggestion was they should instead be made to jog on the spot in a pen for ten minutes, then open the gate and let them sprint to the line. I am looking forward to other track events though, particularly the sprints, but these days even the 800 metres could be called a sprint.
It is difficult to really appreciate the speed of some the cyclists, swimmers and runners. At one stage the BMX racing looked as though it had been sped up, and how anyone can move through water at such a rate of knots without an engine is amazzing. One idea I saw on twitter was that each event should include one ‘normal’ person to highlight the incredible feats the athletes actually achieve.
On the subject of incredible feats, today marks the 55th anniversary of Englands World Cup win. Despite some valiant attempts, we’ve not been able to match that achievement ever since.
- 10.00 EU GDP, CPI, unemployment
- 13.30 US core PCE, personal income, spending
- 13.30 CAD GDP
- 14.00 Feds Bullard, Brainard speak
- 14.45 US Chicago PMI
- 15.00 US Michigan sentiment survey
- 20.30 CFTC position data