Back to our previously scheduled programme

Today’s news headlines:

• ‘Trump threatens to cut off relations with China’. Donald Trump is escalating his rhetoric toward China, even going so far as to suggest a complete breaking of ties. It's not clear if this was a serious policy, but the US Administration is certainly on the offensive heading into the election season. Some policy measures under consideration are blocking Chinese companies from listing on US markets, blocking Chinese student visas related to sensitive research, and taxing US firms with Chinese supply lines. (Financial Times)

• ‘Treasury eyes lifting loan caps for "squeezed middle" companies’. The UK government is considering adjusting its Coronavirus Large Business Interruption Loan Scheme (CLBILS) which provides loans to mid-sized UK companies which do not meet requirements to issue short-term funding vehicles like commercial paper.  Companies with turnover of £250m may call on £50m in government-backed loans, but UK Chancellor Rishi Sunak is considering quadrupling that limit to £200m. Some companies like Tata Steel, which requires hundreds of millions of loans to sustain itself, want to see the cap lifted. (Financial Times)

Today's events, rates, and data 

• Yesterday was yet another day of market sell off’s, but this morning UK and EU equity futures are pointing to a higher open. The UK prepares to return to work, the Federal Reserve has started buying Exchange Traded Funds (ETFs), but the real focus remains on obstacles to progress: US-China disputes, and the US-UK and UK-EU trade deal negotiations which are back in the headlines.

Today's events

CN Retails Sales y/y                         -7.5% vs -15.8% last month
CN Industrial Production y/y            3.9% vs -1.1% last month
US Retail Sales                                 1:30PM
US Industrial Production                  2:15PM
US UoM Consumer Sentiment        3:00PM

Interbank rates:

GBP/USD   1.2200
GBP/EUR   1.1300
EUR/USD   1.0800