Feeling the pinch

Today's news headlines:

‘UK inflation hits 9% in April’. Prices continue to soar in the UK, with inflation reaching its highest level for 40 years in April, rising 9%. This can be attributed to the increase in the energy price cap last month, which saw household bills climb as much as 54%. A study by McKinsey found that consumers appear to be more concerned about energy usage, with most respondents only using what is essential. It remains to be seen how long these elevated inflation levels will last, but a predicted 30% rise in energy bills in October will appear to put the issue front and centre for the rest of the year. (Financial Times)

‘Janet Yellen targets Russian oil in EU talks with price cap and tariff proposals’. US Treasury Secretary Janet Yellen is in talks with European allies about a potential price cap on Russian oil that would limit the country’s revenues. These initial plans could serve as a path to a full Russian oil embargo next year, according to some senior US officials, as the European Union attempts to acquire different sources of energy supplies. (Financial Times)


Today

Asian markets were mixed overnight following a bounce on Wall Street yesterday. The US Dollar Index has gained 25 basis points in early trade following Federal Reserve Chairman Jerome Powell’s hawkish comments on inflation. US Sovereign yields are higher this morning, while European markets edge out some early gains. 

Events

UK Consumer Price Index y/y (April): 9.0% (est. 9.1%)
UK House Price Index y/y: 9:30AM
Canadian CPI m/m (April): 1:30PM
US Housing Starts: 1:30PM
US Crude Oil Inventories: 3:30PM
G7 meetings: All day

Interbank rates:

GBP/USD – 1.2419
GBP/EUR – 1.1807
EUR/USD – 1.0518
USD/CAD – 1.2824

The markets are moving. To speak to our team, please call +44 (0)20 3465 8200.