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Consumer prices rise again

Today's news headlines: 

‘UK inflation rises sharply to 2.5%’. Inflation rose yet again in June, far ahead of analysts’ expectations, placing pressure on the Bank of England to begin some kind of tapering in monetary policy. Second-hand car prices look to be driving inflation as the global semiconductor shortage is hampering the production of new vehicles, leading many to seek out second-hand alternatives. The situation is similar in the US, with June’s consumer prices rising 5.4% year over year. The Federal Reserve has remained cautious on monetary policy, much like the BoE, with policymakers expecting tapering to be some way off yet. (Financial Times)

‘Khan and Sturgeon rebuff Johnson by insisting on masks for transport’. London Mayor Sadiq Khan has opposed Boris Johnson's recent announcement that wearing a face covering on public transport will be a matter of personal choice when the UK fully unlocks on the 19th of July. Nicola Sturgeon has also expressed concern over this approach with the belief that this measure should be kept in place for as long as is needed. It's thought that all public transport in London will still require a face covering, described as a ‘condition of carriage’ on all TFL services. (Financial Times)

Today's events, rates, and data 

  • US markets drifted lower after worrying CPI data; the S&P 500 closed 0.35% lower while the Nasdaq finished the day 0.38% softer. Sterling has strengthened against the Euro in early trading despite UK inflation data moving higher this morning.

Today's events

New Zealand interest rate: 0.25% vs 0.25% previously
UK CPI y/y: 2.5% vs 2.1% last month
US PPI and Core PPI m/m: 1:30PM
Bank of Canada rate statement: 3:00PM
Federal Reserve Chairman Jerome Powell testifies: 5:00PM
French Bank Holiday: All day

Interbank rates:

GBP/USD – 1.3844
GBP/EUR – 1.1737
EUR/USD – 1.1794
USD/CAD – 1.2493

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