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US dollar remains high as inflation and tensions rise

Good morning


US dollar is holding onto most post-CPI gains with GBPUSD still below 1.3400, EURUSD 1.1445 and EURGBP 0.8555 (GBPEUR 1.1690). The Michigan sentiment survey out this afternoon has an inflation expectation component which will be closely watched.


Otherwise, tensions between counties seems to be making a lot of headlines.


There is a lot of unrest still over the Belarus/Poland border, with Belarus and Russia holding the keys to EU’s natural gas they will have to be a little careful how they handle the issue. Belarus have already mentioned the potential to cut off gas supplies to Europe. Just to make the whole thing even harder, the US has warned that Russia may be looking to mount an invasion into Ukraine.


EU and UK are still discussing the NI protocol, although press reports suggest UK are still trying to seek a deal and don’t want to trigger Article 16. It is far from resolved as yet mind you. UK and France have the fishing dispute, while UK are unhappy with France about the number of immigrants coming across the Channel, close to 2,000 have been counted this week alone.


Covid numbers are on the rise still, India in the news as its cases increase and there is some talk that a few US states are seeing higher numbers of ICU patients. Austria is considering a lockdown of unvaccinated people and I wouldn’t be surprised if Germany followed suit as their vaccination rate is among the lowest in Europe which seems to suggest s fourth wave is arriving. They reported more than 50,000 new cases in just one day


Biden and Xi are dut to meet next week. I hope Biden congratulates Xi on his renewed grip on power in China after announcing new party resolutions that could see Xi in power for life. It is only the third historical resolution since the start of the China Communist Party and some see it as Xi getting himself on equal terms to the likes of Chairman Mao Zedong.


All this going on, it is easy to lose sight of the important issues, namely my young team who play this Sunday. I’m not sure if I mentioned it, but we have been promoted mid-season to a higher division after a series of solid victories. It is unusual but actually quite a sensible move by the league although it would have been nice to have won some silverware for once! Anyway our first match in the new division is against the team who are currently top. Will be a step up but I reckon we are up to the task. I’ll report back Monday.


- 10.00 EU industrial production

- 13.50 ECBs Lane speaks

- 14.00 BoEs Haskel speaks

- 15.00 US Michigan sentiment survey

- 17.10 Feds Williams speaks

- 20.30 CFTC position data


- Sunday/Monday

- 23.50 Japan GDP

- 00.01 UK rightmove house prices

- 02.00 China retail sales, industrial production



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