UK in focus

Today's news headlines: 

‘UK inflation picks up to highest rate since 1992’. The UK Consumer Price Index reading hit a year-over-year rate of 5.5% in January as the cost-of-living squeeze intensifies. Core inflation, which strips out the effects of food and energy, rose 4.4% in January as price rises across the economy become more embedded. Inflation is likely to peak at 7.0% in April, according to the Bank of England. Analysts are expecting around a 2.5% fall in real incomes this year despite the fiscal measures rolled out by the government to try and soften the blow. (Financial Times)

‘UK beats global stocks in early 2022 as traders hunt for bargains’. UK equities have had a contrasting start to wider markets in 2022. The MSCI UK Index has added around 3.6% year-to-date, while MSCI’s World Index has lost roughly 6.0%. Cheaper valuations in the UK and Europe have fuelled asset re-allocation at the start of 2022 as US markets look relatively expensive. The likelihood of higher interest rates has hit higher duration assets this year, with companies less sensitive to rate rises, coming in favour of JPMorgan upgrading the UK to ‘overweight’. (Financial Times)


Today

Asian markets moved higher overnight following the US market close as a partial withdrawal of Russian troops from the Ukraine border cooled fears of a possible invasion. US and UK bond yields have moved higher this morning, with commodity prices also rising across the board.

Events

UK Consumer Price Index y/y (Jan): 5.5% (est. 5.4%)
UK Core CPI y/y (Jan): 4.4% (est. 4.3%)
Eurozone Industrial Production m/m: 10:00AM
Canada CPI m/m: 1:30PM
Retail and Core Retail Sales m/m: 1:30PM
US Industrial Production m/m: 2:15PM
US Crude Oil Inventories: 3:30PM
Federal Open Market Committee meeting minutes: 7:00PM

Interbank rates:

GBP/USD – 1.3562
GBP/EUR – 1.1917
EUR/USD – 1.1380
USD/CAD – 1.2688

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