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When progress lags

Today’s news headlines:

‘Civil servants wary of office return amid continuing outbreaks’. It seems the government’s advice encouraging workers to return to the office has hit a major hurdle in Whitehall, where civil servants are extremely reluctant to return to cramped old office buildings where safety measures are less than ideal. Senior civil servants have also expressed their satisfaction with working from home, saying it is ‘not detrimental to productivity’. It's said to be unlikely that workers will return en mass before 2021. (Financial Times)

‘Central bankers face virus hit to global economy at crisis forum’. For the first time since its inception in the early 1980s, the Jackson Hole summit is happening in a virtual format, as care-worn central bankers discuss the precarious juggling act with its 2020 monetary policy. The manifold concerns are that the extension of exceptional policy is ‘doing a bit of levitation’, just at a time when the International Monetary Fund forecasts 4.9% contraction in global output. Again, the worry is that fiscal policy is lagging behind and yet more responsibility is inequitably hefted on central bank shoulders. (Financial Times)

Today's events, rates, and data 

  • The rally in equities seems to have hit a wall, sending the Euro lower and buoying the Dollar just off its trade-weighted two-year lows. Again, this all sums up to relatively narrow range trading for EUR, USD, and GBP indices through August. Yesterday’s data was mostly positive in the US, except for consumer confidence which slipped markedly, while German data faired relatively well. News overnight also revealed Angela Merkel had extended unemployment measures, which are likely to generate some more market positivity for the Euro.  

Today's events

AU  Construction Work Done: -0.7% vs 0.7% last quarter
CH  Credit Suisse Economic Sentiment: 9:00 AM
US  Durable Goods Orders m/m: 1:30 PM
CA  Council Member Wilkins speaks: 3:00 PM
UK  MPC Member Haldane speaks: 5:00 PM

Interbank rates:

GBP/USD – 1.3150
GBP/EUR – 1.1130
EUR/USD – 1.1810
USD/CAD – 1.3180