Morning Brief – OECD

Humphrey Percy
Chairman and Founder
Wed 20 Sep 2023


Those fun loving folk at the Organisation for Economic and Cultural Development are at it again by forecasting that the UK will in 2023 stand at the very top of the G7 for….our rate of inflation at 7.2% which is a great deal more than the promised rate by the UK Government for the end of 2023. The response from the Government is less than convincing: that is why we should stick to the policies and the higher interest rates.

GBP/EUR 1.1595.

China versus Mexico

Like most people I thought that China was the USA’s biggest trade partner as measured by having the largest amount of exports to the USA. Like most people I would have been wrong and have been wrong since Q3 2022 when Mexico overtook China and both countries stood at USD 128 billion. Now Mexico is up at USD 130 billion and China at USD 112 billion. Apart from the importance of Mexico to the USA, the strong trade position of Mexico is evidenced by the strength of the MXN.

USD/MXN 17.0890.

UK Petrol

With the price of a barrel of oil up from USD75 in the summer to USD 95.36 now, not surprisingly that 27% increase is hitting UK motorists in their pockets and is also inflationary which is not helping the UK government and their promise to crush inflation or in fact halve it from the 10%+ level where it stood until recently. The average price of a litre is GBP 1.59 for diesel and GBP 1.55 for petrol. According to the RAC a rise to USD 100 for a barrel will add a further 2p to the pump price. However it is not a rise of $5 that should be feared but a great deal more given the actions of Russia and Saudi Arabia to restrict supply. Not far to look as to the UK’s Agenda Item number one for the upcoming state visit by Saudi Arabia’s Crown Prince MBS.

GBP/USD 1.2400.

Stuck With You

It was this day back in 1986 that Huey Lewis and The News had a three week run at the top of the charts with this number during the run up to Big Bang when the financial world in London changed immeasurably for all time. Given the revolving doors in investment banks at that time, the very last thing that was on the minds of senior management was being Stuck With You.

We’ve had some fun, and yes we’ve had our ups and downs
Been down that rocky road, but here we are, still around
We thought about someone else, but neither one took the bait
We thought about breaking up, now we know it’s much too late

We are bound by all the rest
Like the same phone number
All the same friends
And the same address

I am happy to be stuck with you
(Ooh) Yes, it’s true (yes, it’s true)
I’m so happy to be stuck with you
(Ooh) ‘Cause I can see (I can see)
That you’re happy to be stuck with me

We’ve had our doubts
We never took them seriously
And we’ve had our ins and outs (ooh, wa-ooh)
But that’s the way it’s supposed to be
We thought about giving up (giving up)
But we could never stay away
(Ooh, wa-ooh) We thought about breaking up
But now we know it’s much too late

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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