Bizarre really that market analysts are wringing their collective hands because China’s growth for this quarter may dip below 6% after 6.2% in the last reported March to June period. In Europe’s anaemic world, we can only dream about such a figure. Needless to say the headlines will all reflect the impact of the trade war on the world’s second largest economy, but China is still projecting a growth figure of 6.5% for 2019 which is not too shabby. In any case if you have not spotted it, October 1st 2019 is the 70th anniversary of the founding of the People’s Republic of China and why is that significant? Be sure: there will be a lot of celebratory projects and spending in Q4 which will make damn sure that that 6.5% figure is achieved!
With WTI Oil now at $58 versus the $55 pre drone attack price, measures taken by the Saudis to restore supplies and a minor drop in the temperature of the US anti Iran rhetoric can so far be judged to have been successful. Markets have moved on to sift through the Fed announcement of the cut in US rates and the BoE report from yesterday which signalled low rates for longer in the UK. What both Central Banks have done is to give themselves flexibility to cut or not cut later-albeit for very different reasons-rather than expend the meagre ammunition that remains to them too early.
A surprise drop of 0.2% in retail sales and a much larger fall of 3.2% in on line sales from the previous month. Never fear, the SGM-FX team of analysts can explain this: canny SGM-FX shopper Graham has been spotted nipping into Costco on a much more frequent basis in recent weeks while his online Amazon deliveries to the office have dwindled to a trickle-just how many widescreen TVs does a man need?!
Alas these trips to Costco have not been sufficient to keep the whole of UK Retail Sales on an upward trend, but we do understand that Graham has a full freezer of tomahawk steaks and chicken breasts (less than £1 each if you are interested) as well as crates and crates of wife beater(Stella Artois). What a patriot!
Discussion and Analysis by Humphrey Percy, Chairman and Founder
Eurozone That was a surprise: yesterday the EU announced that inflation had fallen to 2.4% which was considerably better than the 2.7% that markets had expected. Despite the ECB saying it was far too early to cut rates, the market has pencilled in the first cut for April. Before getting carried away it should be […]
Data Day Despite salient data already having been published in China and France so far this morning, we are far from finished with the deluge of data due to reach the market today. The most important of which will be those that we have signposted in earlier briefings: Eurozone and US inflation figures. Given just […]
UK Labour market The Bank of England yesterday broke cover to drive the message home that due to the UK’s labour market remaining tight, it was premature to start talking interest rate cuts and it was not just Governor Bailey who was calling for higher for longer interest rates but also his MEPC colleague Jonathan […]