Daily Brief – British Pound

British Pound

Whenever one reads a headline such as Sterling at a 38 month high versus USD, the tendency is to assume that GBP is due for a hubristic fall after that particular piece of pride. However this time it might just be different with no sign that USD has turned a corner and is recovering nor that POTUS and his Administration want that to happen. Upcoming news will be dominated by the US employment report together with Q1 growth figures and the Federal Reserve’s favourite management tool of personal Consumption Expenditure.

GBP/USD 1.3404.

Spain

Thrust into the spotlight, or rather the twilight of countrywide power cuts on Monday, Spain with impeccable timing released figures showing Q1 growth of 0.6% and forecasted to be 2.5% for 2025 before dropping to 1.8% in 2026. However the trend is down having managed 3.2% in 2024 and with plenty more to do according to the men with the clipboards at the IMF on both reducing its fiscal and public debt. However Spain along with the rest of Western Europe has pledged to markedly increase defence spending which will hamper any debt reduction. There is also the perennial issue in Spain of high unemployment which stands at 11.4% at the end of Q1. If it was reflected on a report card, Spain would be marked as having delivered mixed results rather than being the goody two shoes at the top of the class where it was in 2024 in the EU big boys classroom.

EUR/USD 1.1386.

Australian Wine

China as many will know is Australia’s most profitable overseas market for wine exports. In March 2024, China lifted its tariffs and the Australian wine exporters have been making if not hay, certainly grapes with more than AUD 1 billion of wine shipped to China in the year ending March 2025. However China’s appetite for wine has been dropping with imports from France, Chile and Italy more than halving since 2018. It would look like a combination of factors behind China’s loss of appetite for the world of wine: improved technology in the home market leading to more better domestic wine production, inventories having been topped up and last but not least a reduction in alcohol consumption as part of the healthy global trend particularly among younger people.

USD/JPY 142.22.

Greeting Cards

It used to be a thing but increasingly it’s not and especially among Gen X and Z. Cynics might blame it on the cost since UK postage can cost GBP3.15 and cards are anything from GBP3 upwards, but there are the alternatives of a text or an email or an amusing WhatsApp joke or an e-card which are all guaranteed to arrive instantly with the added attraction of being free. Having visited a Cards Galore recently and tried in vain to find the right sort of birthday card, it may simply be that the cards on offer are mostly crap, unfunny and lack the amusement value of yesteryear. As good an explanation as any.

EUR/GBP 0.8498.

True

This day in 1983 then new wave band Spandau Ballet scored their one and only Number One with this hit which was also the title of their third album. Exhausted by the plumbing of all those creative juices, the band had clearly run out of ideas when it came to naming their album.

So true, funny how it seems
Always in time, but never in line for dreams
Head over heels when toe to toe
This is the sound of my soul
This is the sound

I bought a ticket to the world
But now I’ve come back again
Why do I find it hard to write the next line?
I want the truth to be said

I, I-I-I, I
I know this much is true
I, I-I-I, I
I know this much is true

With a thrill in my head and a pill on my tongue
Dissolve the nerves that have just begun
Listening to Marvin (all night long)
This is the sound of my soul
This is the sound

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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