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  • richard evans

USD weakness continues......

Good morning

USD weakness continues with EURUSD reaching a high of 1.1075 and GBPUSD reaching 1.2545 in the early hours of this morning. This more a continuation of the theme we have seem most of the week rather than anything new. Even a stronger than expected retail sales number out of the US today may not be enough to turn this trend.

BoEs Pill spoke yesterday, hawkish as usual, saying inflation is persistent and higher rates will be needed although did add that inflation will eventually come down. No idea of timing though so for now it seems as though further rate rises could be seen from BoE. If anything ECB are even more certain to raise rates at their next meeting, question is really whether they look at a 25 or 50bps increase.

Eventually the market will soon be looking to see which central bank cust rates first. It’s still probably a fair way off but worth considering for longer term trends, a quick look at the positive stock markets suggests I’m not the only one thinking we are near peak rates. BoE, Fed and ECB is my order assuming no major change in other factors. BoE first as I’d expect UK economy to struggle, Fed next and ECB last only really because their rates are still lower than both UK and US.

Gold has followed the weaker USD trend, trading up to almost $2050 yesterday and again overnight. Well worth watching this level, plus don’t forget the all-time high in the $2075-2080 area which will obviously draw some attention. Bitcoin did breach $31,000 briefly, now just a smidge under that level. I try not mention crypto again for a while unless something significant happens.

I was reading with some dismay about the lady who used her garden as a place to grow food for some 1,600 needy people, she awoke the other day to find the allotment had been vandalised by some idiot who sprinkled salt on the soil which damages the earth and plants. Why on earth would anyone do such a thing?

Anyway, to end the week on a positive note, a gofundme page had been set up and as at yesterday some £190,000 had been raised for her, far more than is needed to sort the problem but I have a feeling that the remaining fjnds will not go to waste and will truly help a decent number of people. There are some bad people around, and bad things do happen, but it is worth remembering that the vast majority of people are decent, law-abiding citizens who really only want the best for themselves and others.

One more piece of good news, for me at least. I’m off now on a golf weekend with friends who I used to play football with but turned to golf when we hung up our boots many years ago. I enjoy golf for the social side, and haven’t played much in recent years due to this issue with my shoulders. Anyway i’ll put the new shoulder to the test and see what happens although I’m not expecting much given I haven’t played for such a long time. Really just hoping the rain holds off although that’s not looking too promising. Golf is, for me, very much a fair weather pastime.

Have a great weekend, good luck to anyone having a bet on the Grand National, plenty of other sports to enjoy over the weekend as well.

- 13.30 US retail sales

- 13.45 Feds Waller speaks

- 15.00 US Michigan sentiment survey

- 16.30 BoEs Tenreyro speaks

- 19.15 ECBs Nagel speaks


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