Daily Brief – ECB President

ECB President

As regular readers will recall, we have previously speculated as to who might succeed Christine Lagarde as ECB President when her term is up in October 2027 now just 15 months away. The watercoolers in the ECB’s HQ in Frankfurt have been busier in the last few days with talk that Mme Lagarde will step down 6 months earlier in April next year to allow President Macron and Chancellor Merz to settle on her successor in good time before France’s presidential election in April. Our previous pick was BIS supremo Spaniard Pablo Hernandez de Cos but that was dependant on Spain selecting him as their chosen candidate. That has now happened and Spain are making a strong case that a Spaniard should lead the ECB. There is an element of brinkmanship here as Mr Hernandez de Cos has said that there is only one job that he will leave the BIS for and that is as President. Not only does he look eminently qualified to make the trip, but Pablo Hernandez de Cos looks to have the political nous to do the job. There are of course other strong candidates: Germany’s Joachim Nagel and Isabel Schnabel and the Netherlands’ Klaas Knot, but momentum based on Spain’s dazzling World Cip performance looks to be with Pablo Hernandez de Cos -this week at least.

EUR/USD 1.1403.

Nominal GDP

Comparing the worlds’ economies between 2000 and 2026 throws up mostly GDP growth pictures of a similar size plus some standout performances.  The outlier is Japan which declined from a nominal GDP of USD 4.9T to USD 4.4T. Most countries including the UK, Germany, France, Canada, Mexico, South Korea, Italy and Spain approximately tripled in size. But it is China that grew from USD 1.2T to USD 20.9T and India from USD 468B to USD 4.2T that are top of the growth class. India incidentally is hard on the heels of the UK that currently stands at USD 4.3T.

GBP/USD 1.3364.

Oil and Gas

With Brent Crude up to USD 100.09 late last night, it is worth noting that the price after the temporary USA-Iran deal in June stood at USD 72 and all those so clever market analysts were saying that the previous 3 months could be put to one side and it was energy business as usual. A rise in 6 weeks since then of 40% cannot be ignored and neither can the EU Natural Gas contract which in the same period went from EUR39 to EUR62 per MWhr or 59%. Reserves of both Oil and Gas are below normal levels, and it is far from likely that they will be replenished to the target 80% of capacity level before the winter months. As such, even with increased oil supplies already approved for August onwards, the oil and the gas prices will remain high in the absence of a binding and workable US-Iran peace deal plus will remain susceptible to further sharp moves both up and down.

EUR/JPY 186.31.

Dehydrated Hedgehogs

No, this is not (yet)on the menu at a Michelin starred restaurant near you as far as we know. Instead, an outbreak of dehydrated orphaned hoglets (mini hedgehogs) has occurred with the creatures having become separated from their parents being treated in rescue centres. Signs of distress include sightings of the normally nocturnal hoglets in the daytime looking lethargic and wobbly. Rather similar to their human teenage counterparts in Rock, Cornwall on their first independent holidays as they make their first tentative steps into the world of alcohol.

EUR/GBP 0.8533.

Eye of The Tiger

This day in 1982 Survivor topped the US Charts with this number. More senior readers will recall a pumped-up Sylvester Stallone preparing for a seemingly unwinnable bout by hauling tree trunks, tractor tyres and battering a punch bag in a logging camp before entering the ring, of course, to triumph in what was hit film Rocky III all to the anthem of Eye of The Tiger. Unforgettable.

Risin’ up, back on the street
Did my time, took my chances
Went the distance now I’m back on my feet
Just a man and his will to survive
So many times it happens too fast
You trade your passion for glory
Don’t lose your grip on the dreams of the past
You must fight just to keep them alive

It’s the eye of the tiger
IT’S THE THRILL OF THE FIGHT
Rising up to the challenge of our rival
And the last known survivor
Stalks his prey in the night
And he’s watching us all
With the eye of the tiger

Face to face, out in the heat
Hangin’ tough, stayin’ hungry
They stack the odds still we take to the street
For the kill, with the skill to survive It’s the eye of the tiger
IT’S THE THRILL OF THE FIGHT
Rising up to the challenge of our rival
And the last known survivor
Stalks his prey in the night
And he’s watching us all
With the eye of the tiger

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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