One for the ages

Today’s news headlines:

‘UK enters historic recession as quarterly output collapses by 20%'. The UK economy contracted by a fifth in the second quarter of 2020, more than any other major European economy, resulting in the deepest recession on record. Over the quarter, all sectors experienced widespread contractions, but the recovery did gain momentum in June, with output growing 8.7% month on month. (Financial Times)

‘Investors optimistic about Germany’s economic prospects’. Investors have significantly raised their confidence about the future of Germany’s economy, but sentiment about the current climate remains in negative territory according to the ZEW survey. Optimism about future economic conditions climbed to a record 71.5 points, the highest level since 2004. Sentiment about the development of the overall Eurozone also rose from the previous month. The improvement follows signs that the country was recovering from lockdown quicker than other major European economies. (Financial Times)

Today's events, rates, and data 

• Gold fell steeply to drop below $1900 following a jump in 10-year US treasury yields, which in turn also supported the US Dollar against other safe-havens like the Yen. US and European stock index futures were relatively static after a mixed session for equities across the Asia-Pacific region.

Today's events

New Zealand Official Cash Rate: 0.25% unchanged
UK Preliminary GDP: -20.4% vs -2.2% previously
UK Preliminary Business Investment: -31.4% vs -0.3% previously
UK Index of Services: -19.9% vs -18.5% previously
UK Industrial Production: 9.3% vs 6.2% previously
UK Manufacturing Production: 11.0% vs 8.3% previously
Eurozone Industrial Production: 10.00am
US CPI and Core CPI: 1.30pm
US Crude Oil Inventories: 3.30pm

Interbank rates:

GBP/USD: 1.3040
GBP/EUR: 1.1120
EUR/USD: 1.1725
USD/CAD: 1.3330