Last week saw the biggest drop in world stock markets for 2 years but now things have calmed down…or have they? With inflation topping out/coming down, it will allow Central Banks to ease off their recent tightening, but that does not mean that volatility will ease, in fact it is much more likely to remain high. Germany’s most powerful union, IG Metall is looking for up to 8% wage rises for its members and ECB President, Madame Lagarde came out with a statement saying that financial stability risks have perceptibly increased since the beginning of 2022. With the key 30 year home financing rate in the USA rising to 6%, that will have a knock on effect worldwide, so expect a correction in the housing market too. EUR/USD 1.0560.
Normally it is its northerly neighbour that is in the news for rockets, but yesterday it was the turn of South Korea to launch its Nuri rocket which was successful in putting six satellites in orbit. The Naro Space Center on the South coast of South Korea reported that they are now on the way to put 1.5 ton payloads into orbit 800km above Earth. Stand by for 6G phone networks, spy satellites and even a Moon shot. Despite all this progress, Korean Won at its lowest level for a year: USD/KRW 1291.
A strong USD and high oil prices plus inflationary pressure and a shortage of workers are causing furrowed brows at the IATA conference in Doha this week. Easyjet which has been much in the news this past week for the wrong reasons, sought to distract attention by announcing an order for 56 new Airbus planes. Otherwise, the mood was determinedly upbeat doubtless due to all airlines raising airfares to eye watering levels post pandemic (because they can)
Who can forget this cracker which became the best selling record in the USA this day in 1974 for The Stylistics? For those who don’t remember The Stylistics, they were a top Philadelphia soul band which sounded a whole lot better than the somewhat syrupy lyrics below suggest:
Ladies, this is for you
My love
I’ll never find the words, my love
To tell you how I feel, my love
Mere words could not explain
Precious love
You held my life within your hands
Created everything I am
Taught me how to live again
Only you, care when I needed a friend
Believe in me through thick and thin
This song is for you
Filled with gratitude and love
God bless you
You make me feel brand new
For God blessed me with you
You make me feel brand new
I sing this song ’cause you
Make me feel brand new
My love
Whenever I was insecure
You build me up and made me sure
You gave my pride back to me
Precious friend
With you I’ll always have a friend
You’re someone who I can depend
To walk a path that sometimes bend
Discussion and Analysis by Humphrey Percy, Chairman and Founder
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