Soft landing a possibility
Today's news headlines:
‘UK workforce dropouts reduce unemployment to lowest since 1974’. The UK labour market continues to tighten as the unemployment rate fell to 3.6% in the three months to July. With little excess room for employment, the extra capacity for growth is limited to an uptick in wages. This puts the Bank of England in a tough spot, staring down the barrel of a slowing economy and rising prices, an increase in wages would only exacerbate inflation further, with the headline rate far above the central bank’s 2% target. (Bloomberg)
‘JPMorgan team says soft landing is more likely than recession’. Strategists at JPMorgan believe a soft landing for the global economy is the most likely outcome. Central banks across the world have been trying to reign in soaring prices while attempting not to leave long-lasting scars on the economy. Cooling inflation could help to moderate inflation expectations in the coming months, potentially sparking a turnaround in consumer sentiment. JPMorgan maintains a positive outlook on cyclical assets heading into 2023. (Bloomberg)
Asia shares continued the market trend higher overnight, with European and US equity futures following suit. The Dollar Index declined for a third straight day as markets expect US inflation to have cooled in August.
Australia NAB Business Confidence (Aug): 10 (prev. 7)
UK Claimant Count Change (Aug): 6.3K (est. -13.2K)
UK Unemployment Rate (July): 3.6% (est. 3.8%)
Eurozone ZEW Economic Sentiment (Sep): 10:00AM
US CPI and Core CPI MoM (Aug): 1:30PM
GBP/USD – 1.1709
GBP/EUR – 1.1555
EUR/USD – 1.0132
USD/CAD – 1.2983
Please contact your Dealer about any upcoming FX requirements you may have, or call +44 (0)20 3465 8200.
*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.