Daily Brief – British Pound

British Pound

The end of last week saw Sterling up over 1% and analysts were declaring that the reason was that the reality of incoming PM Andy Burnham was not as bad as was feared and that he had pledged fiscal rectitude rather than worshipping at the foot of the magic money tree brand of economics feared by many. Far be it for us to be downbeat, but this does sound more than optimistic given both the reality of the UK’s finances and the fact that AB’s default is to be a people pleaser. It is not at all a stretch to believe that Andy Burnham has once again sought to please financial markets in this instance by saying what they want to hear as part of his ambition to become Prime Minister. Much has been made of Lord Jim O’Neill’s wise council towards Andy Burnham as well as that of the hugely respected Andy Haldane but as a cautionary tale, I cast my mind back 30 years to a keenly fought debate with a derivatives colleague whom I accused of not hearing what I considered to be a sound argument.
“No” he replied, “I am hearing but I am not listening.”

GBP/USD 1.3340.

US Dollar

In the past two sessions USD has given up some ground which has also flattered GBP and EUR; this is on the back of a weakening US economy as reflected in weaker employment numbers and has encouraged the belief that the Federal Reserve is under less pressure to raise rates. With the market rapidly losing sight of the fact that the US-Iran agreement is temporary and will expire at the end of this month, while there is a case for USD to weaken against EUR towards 1.18, it should be remembered that it is currently trading towards the base of a fairly firm range of 1.14 to 1.18 and should it fall through that base, it could move sharply as we enter the summer period which historically has been marked by larger currency fluctuations.

EUR/USD 1.1428.

Kismet Kebabs

Never mind mutton dressed as lamb, it turns out that your lamb kebab is probably only a max of 10% lamb and that the great gourmet British public has been enjoying what they thought were lamb kebabs for years but were in fact more a combination of goat, offcuts and skin. Kismet Kebabs of Essex is one of the largest suppliers to the doner kebab market and has cleaned up to the tune of GBP 6 million having packaged some of its product as lamb, chicken drumsticks and goat and others as 87% lamb. KK were caught out in the food fraud as their claimed product composition was simply too good to be true for the price. Certainly, the lager fuelled late night kebab market had not clocked it.

EUR/GBP 0.8567.

GLM 5.2

This is the new Chinese AI offering from Zai.i that is challenging Claude and ChatGPT- 5.5 in the wake of sales of Anthropic being banned to non-Americans. If all this sounds confusing if not gobbledygook, all that you need to know is that the AI race is well and truly on and that users need not commit to any product given that newer, better, faster challengers are around the very next corner.

EUR/JPY 185.23.

Jumpin’ Jack Flash

Here’s a piece of rock and roll trivia: Rolling Stones bandmates Mick Jagger and Keith Richards while staying in 1968 at Keith’s Sussex pad and writing some songs having stayed up late to get those creative juices working in the small hours, had slept in only to be awakened the next morning. The conversation went something along the lines of “What was that, Keith?” and the reply “ That was Jack-Jumpin’ Jack.” The Jack in question was Keith’s gardener Jack Dyer and the rest is history with the song going to Number 1 this day in 1968.

Watch it

I was born in a cross-fire hurricane
And I howled at my ma’ in the driving rain

But it’s alright now, in fact, it’s a gas
But it’s alright, I’m jumpin’ Jack Flash
It’s a gas, gas, gas

I was raised by a toothless, bearded hag
I was schooled with a strap right across my back

But it’s alright now, in fact, it’s a gas
But it’s alright, I’m Jumpin’ Jack Flash
It’s a gas, gas, gas
Ooh

I was drowned, I was washed up and left for dead
I fell down to my feet and I saw they bled, yeah-yeah
I frowned at the crumbs of a crust of bread, yeah-yeah-yeah
I was crowned with a spike right through my head

But it’s alright now, in fact, it’s a gas
But it’s alright, I’m Jumpin’ Jack Flash
It’s a gas, gas, gas

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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