Wurst case to best case
The UK Government unveiled plans to offer subsidies to companies with a “more agile and flexible” system than pre-Brexit when the U.K. had to follow the EU’s state aid regime. In Covid news, the latest figures reveal 20,479 new cases, a drop of 2,389 on the day before but sadly the death toll rose from 3 to 23. In football news, England exorcised a 55 year old ghost when they beat Germany 2-0 in a match that actually mattered. The markets have yet to price in an England Euro tournament victory but we’ll keep you posted.
UK first-quarter GDP figures showed a drop of 1.6%, slightly lower than the 1.5% initially expected. GBP/USD is trading around 1.3830 this morning as worries about the spread of the Delta variant persist. Bank of England member Andy Haldane speaks later today and we are expecting further impact from end of quarter flows as traders close positions to bank their profits. The trend this morning seems to be the US Dollar losing ground across the board except against the Pound. Also slated for release today are Eurozone inflation figures and speeches from US Fed members and the US ADP jobs report. There is also a chance we’ll see an EU conciliatory announcement on the “Sausage war”, but the Northern Irish protocol is still subject to court action.
Wednesday: China official PMIs; UK GDP final, current account; France consumer spending, CPI; Germany unemployment; Eurozone CPI; Swiss KOF, Credit Suisse economic expectations;Canada GDP, IPPI and RMPI; US ADP employment, Chicago PMI, pending home sales.
Thursday: New Zealand building permits; Australia balance; Japan Tankan survey, PMI manufacturing final; China Caixin PMI manufacturing; Germany retail sales; Swiss CPI, retail sales; Eurozone PMI manufacturing final, unemployment rate;UK PMI manufacturing final; US jobless claims, ISM manufacturing.
Friday: Japan monetary base; Eurozone PPI; Canada building permits, trade balance; US non-farm payroll employment, trade balance, factory orders; Canada PMI manufacturing.