Sterling stronger as new Prime Minister offers some respite from uncertainty
|Today's Highlights
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Sterling strengthens on Boris win – or less uncertainty
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German manufacturing continues to contract
Current Market Overview
BoJo is in the House; well, he will be before the end of the day. In spite of the BBC's entirely negative reporting of his 2:1 majority in his party, let’s hope he can deliver on his promises and get the UK out of the doldrums it has occupied for three interminably dull years. Sterling, which was knocked by a very poor Confederation of British Industry (CBI) survey earlier in the day, found some buyers in later trade and has gained three quarters of a cent against the Euro and US Dollar in the last 24 hours. Ultimately, there appears to be little doubt that all that is required for Sterling to strengthen is certainty.
Other than Mr Johnson getting his furniture installed in No. 10 today, there is little UK data to focus on other than some mortgage data, so Sterling should tread water unless the new Prime Minister’s speech outside his new gaff throws up anything unexpected.
New Zealand Dollar up
The New Zealand Dollar got a boost overnight after New Zealand’s trade deficit shrank by NZ$600 million; a far larger contraction than the markets had envisaged. That detracts from the calls for lower New Zealand interest rates.
Plenty data from USA today
In fact, the only interesting data today comes from across the Pond. A slew of manufacturing and housing sector data is expected later and it will most likely be largely ignored as events in Iran, China and elsewhere dominate the US Dollar’s desirability as a safe place for investors to house their wealth while geopolitical tensions exist.
Before all that, though…
We have already had a smattering of purchasing managers’ indices (PMI) from the Eurozone. Germany’s service sector held up well in June, but their manufacturing sector; the powerhouse of Europe, dropped again. A 50 reading in these indices demarks a zero growth expectation, but the German manufacturing PMI is at 43.1; very worrying indeed. That may help the UK negotiators, because Germany really does not need World Trade Organization (WTO) tariffs on their exports to the UK.
That’s a bit steep!
And this’ll kick things off. Ffordd Pen Llech, a road in Harlech, North Wales, has been named the steepest road in the world by the Guinness Book of World Records. At 37 degrees, it is 2 degrees steeper than the previous record holder in New Zealand. Those who believe their town has a steeper street, please form an orderly queue.
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