Daily Brief – Europe

Europe

With EU annual inflation coming in at 2.4% up from 2.2%, conventional wisdom might suggest that that might dampen the ECB’s enthusiasm for an early cut in EUR interest rates at the end of January. But such is the weakness pervading the EU economies, it is more likely that the hawkish tendencies at the European Central bank will be outnumbered by those looking for an economic adrenaline shot in the heart of Europe.

EUR/USD 1.0394

CES

The Consumer Electronics show in Las Vegas is big: 140,000 delegates, 4000 exhibitors, 160 countries and 60% of the Fortune 500 companies. Lots of innovation as well as developments in chips and software. If that all leaves you cold, think about this: cosmetics company L’Oreal announced a device that can not only analyse your skin but can give you advice on slowing the ageing process. That plus dry January should do it.

GBP/USD 1.2535

Oil

Oil on the rise yesterday with Brent up to $76.89 due to fears of oil supply disruption of Iranian crude to China which will place pressure on other sources of oil given that China seems to be looking to gear up. That plus sanctions: Port operator the Shandong Group has banned US sanctioned oil vessels from its ports.

EUR/GBP 0.8291

UK Christmas Trading

Early indications are that this is not a happy story with the retail industry facing lay offs after a disappointing trading period in December. Zero growth on Consumer and Credit Card spending from Barclays and households cutting back on pub and restaurant outings.

EUR/JPY 163.99

Starman

This day in 1947 David Bowie was born and grew up to become one of the greatest rock and fashion influences in the world as well as pioneering the art of selling off his catalogue of music in the financial world before succumbing too early at the age of 69 in 2016. Who can forget his stylishness as well as his sense of fun.

Didn’t know what time it was, the lights were low
I leaned back on my radio
Some cat was layin’ down some rock ‘n’ roll
“Lotta soul, ” he said
Then the loud sound did seem to fade
Came back like a slow voice on a wave of phase
That wasn’t no DJ, that was hazy cosmic jive

There’s a starman waiting in the sky
He’d like to come and meet us
But he thinks he’d blow our minds
There’s a starman waiting in the sky
He’s told us not to blow it
‘Cause he knows it’s all worthwhile
He told me
Let the children lose it
Let the children use it
Let all the children boogie

I had to phone someone, so I picked on you
Hey, that’s far out, so you heard him too
Switch on the TV, we may pick him up on channel two
Look out your window, I can see his light
If we can sparkle, he may land tonight
Don’t tell your papa or he’ll get us locked up in fright

There’s a starman waiting in the sky
He’d like to come and meet us
But he thinks he’d blow our minds
There’s a starman waiting in the sky
He’s told us not to blow it
‘Cause he knows it’s all worthwhile
He told me
Let the children lose it

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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