Slow progress

Today’s news headlines:

‘UK economic output rises 1.8% in May after historic April plunge’. The UK’s coronavirus-hit economy rebounded to a degree in May after a relaxing on restrictions provided a boost to economic activity. However, GDP grew by just 1.8% in May, which fell well below the market consensus of a 5.5% increase. The rise in GDP was supported by an 8.2% increase in construction activity and an 8.4% uplift in manufacturing. The UK’s economy remains 24% smaller than in the same month last year, meaning it still has a long way to go to recover from the pandemic. (Financial Times)

‘US hardens stance against China’s claims in South China Sea’. The US has taken a harder stance on China’s territorial claims in the South China Sea along with a vow to keep pressuring the nation on their human rights abuses in Xinjiang after Beijing issued sanctions against US individuals. The move reverses their previous policy of not interfering in territorial disputes in the region and serves to escalate tensions between the two on yet another front. China’s foreign minister has recently commented that relations were at their worst since the nations established diplomatic ties, four decades ago. (Financial Times)

Today's events, rates, and data 

• The US Dollar remained relatively flat overnight; however, analysts are predicting a slide over the coming months due to political and health risks in the country. Oil dropped for a second day, while European equity futures pointed lower.

Today's events

Chinese Trade Balance: 329B vs 443B previously
German Final CPI: 0.6% vs 0.6% previously
UK GDP: 1.8% vs -20.3% previously 
UK Industrial Production: 6.0% vs -20.2% previously
Eurozone Industrial Production: 10.00am
ZEW Economic Sentiment: 10.00am
German ZEW Economic Sentiment: 10.00am
US CPI and Core CPI: 1.30pm

Interbank rates:

GBP/USD: 1.2535
GBP/EUR: 1.1055
EUR/USD: 1.1338
USD/CAD: 1.3620