Daily Brief – Great British Pound

Great British Pound

After a lacklustre reaction to the UK interest rate cut on Thursday and a more visceral one to the much less rosy Bank of England economic forecasts, GBP staged a recovery at the end of the week. However over the weekend a series of less than optimistic commentary on the BoE, the UK Chancellor and consequently the UK’s economic outlook will cap the further upward move in GBP from where it now stands.

GBP/USD 1.2460.

Porsche

In May 2023 the market cap of Porsche stood at EUR 110 billion. Contrast that with where it is today at EUR 52 billion. Unsurprisingly the company is looking to reverse the situation with the introduction of new models and expenditure on battery technology. Those initiatives will reduce the operating margin from 15% to 10-12% and the share price looks soggy despite already falling 27% in 2024. The new models are carbon or hybrid which speaks volumes and reflects low demand for Porsche EVs. Tough times.

GBP/EUR 1.2008.

Bird Flu

A dozen eggs in the USA now costs $4 up from $2.50 in the past year. That may sound fair to UK readers who pay £3.30 for 12 medium sized eggs from Tescos which is almost the same. Stand by though as the bird flu epidemic is slated to send egg prices up a further 20% in 2025. Some chains such as Wendy’s are now adding 50 cents per egg to their prices so it’s only a matter of time before the staple of Egg McMuffins rise similarly at rival McDonalds.

EUR/USD 1.0328.

Careers in Finance

Those 2025 graduates contemplating a career in finance should not hesitate in making a beeline for the Citibank desk at their university career fairs. CEO Jane Fraser is bucking the trend by sticking to 2 days a week WFH as a recruitment carrot, plus Zoom free Fridays, plus friendly maternity and paternity allowances for those thinking further ahead. A welcome departure from the weekly 90+ hour dark satanic mills working conditions for newbies at other investment banks. 

USD/JPY 151.41.

How Long

This day in 2008 The Eagles won a Grammy award not for length of service to the rock industry-although they might well have done- but for the Best Country Performance with Vocal category. I first saw them in 1976 and again 20 years later at Wembley in 1996 but even that turned out to be just another milestone on their 50 year performing career.

Like a blue bird with his heart removed, lonely as a train
I’ve run just as far as I can run
If I never see the good old days shinin’ in the sun
I’ll be doin’ fine and then some

How long, how long
Woman will you weep?
How long, how long
Rock yourself to sleep

Well, I been doin’ time in a lonesome prison, where the sun don’t shine
Just outside, the freedom river runs
Out there in that shiny night, with blood hounds on your mind
Don’t you know it’s the same sad situation?

How long, how long
Woman will you weep?
How long, how long
Rock yourself to sleep

Everybody feels alright you know, I heard some poor fool say (somebody)
Everyone is out there on the loose
Well, I wish I lived in the land of fools, no one knew my name
But what you get is not quite what you choose

Tell me, how long, how long
Woman will you weep?
How long, how long
Rock yourself to sleep

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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