Daily Brief – Strong USD

Strong USD

Those punitive tariff threats – Copper 50%, Brazil 50% and Pharmaceuticals 200% had a marked effect on USD. Bizarrely, while POTUS has been conducting his self-harming measures on the USA and the USD, he sees no contradiction in maintaining that he sees USD remaining the primary world reserve currency. A total of 22 letters have been issued this week, threatening or cajoling the recipients to participate in the…. “extraordinary economy of the United States” or face extra tariffs than those already promised effective August 1. Markets are extraordinarily sanguine at the moment, but as July moves into August and liquidity thins, while many participants move their sphere of operations to the world’s sunbeds, it is more than likely that larger sharper moves will result from such pronouncements from POTUS, unless he too will be taking a break. Meanwhile USD has steadied and strengthened.

EUR/USD 1.1681.

iPhone16 Pro

Deutsche Bank Research Institute has produced a catchily named report entitled Mapping the World’s Prices. More focused than it initially sounds, it compares the cost of an iPhone 16 Pro 128gb across the world. To save you time reading the report, the short version is do not lose your phone in Turkey, Egypt, Brazil, India or the Nordic area where iPhone 16 Pros will cost between 30% and 100% more than in the USA. So $917 in the USA versus $1854 in Turkey.

GBP/USD 1.3560.

Euro

Just as the Europeans are patting themselves on the back for having a muscular currency that according to ECB President Christine Lagarde is poised to challenge USD as a, if not the, leading world reserve currency, Bank of America has released a report forecasting the imminent crushing effect on the companies making up the EuroStoxx 600 of the 13%+ rise in EUR this year as their overseas earnings are marked down commensurately. Unsurprising but unhelpful to the ECB that is just as likely to raise interest rates after the next quarter point cut which will further exacerbate the situation.

GBP/EUR 1.1610.

Wales Shirts

This one made the news in Wales in an otherwise slow day pre-occupied with the 34c temperatures coming this weekend: female Welsh supporters arriving in Switzerland for the womens’ footie were faced with being unable to buy shirts to show support for their team. Switzerland could provide shirts for all the other 15 teams in the competition but not Wales. Questions were asked by the FAW-Football Association of Wales to the tournament organisers and then to Adidas who in turn referred them to JD Sports. Red faces rather than red shirts at JD Sports which had not stocked enough/any Wales shirts. No red faces for the Swiss-just red shirts with white crosses. Awww.

EUR/JPY 171.19.

Mr Brightside

Regular readers will know of the towering genius that is boy band Rewind member James McElvar who fell ill this day in 2015 on a flight between Stansted and Glasgow suffering from heat exhaustion. He was judged lucky to be alive such were the acute symptoms as a result of him wearing no less than 12 layers of clothing in what actually was a successful bid to avoid paying the GBP45 luggage charge. Hardly rock and roll but definitely a strong performance in Scots parsimony as well as being a topical tale on this torrid weekend in the UK.

When you first left me
I was wanting more
But you were fucking that girl next door
What’cha do that for? (What’cha do that for?)

When you first left me
I didn’t know what to say
I’ve never been on my own that way
Just sat by myself all day

I was so lost back then
But with a little help from my friends
I found the light in the tunnel at the end

Now you’re calling me up on the phone
So you can have a little whine and a moan

And it’s only because you are feeling alone

At first when I see you cry
Yeah It makes me smile
Yeah it makes me smile

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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