The Monetary Policy Committee of the Bank of England has managed to convince the market that it has a rate hike in mind following its meeting yesterday.
Using the entirely fictitious headline employment data as a basis for a belief that the economy is running close to capacity there is just one question. If that is the case why aren’t wages growing at least at a rate closer to inflation? It could be that the data is bu****it, taking into account as it does part-timers, training courses for the young and estimated numbers for the gig economy. Abandoning the downturn that is very real as business investment (or a lack thereof) continues to be driven by fears over Brexit.
Mark Carney, Bank of England Governor and chief proponent of “Emperor's New Clothes” economic guidance feels that the balance of risks in the economy has shifted away from Brexit towards inflation. This is despite is almost constant statements that inflation was due to the weakness of the currency which stems from concerns over Brexit.
Sterling reacted positively to the Governors statement having initially fallen following the 7-2 vote to keep rates unchanged. It reached above 1.3400 against the dollar and has so far continued to climb as more and more weak shorts are closed. Versus the single currency it is unlikely to break the 0.8820 level at the first attempt considering how strong the resistance for the Euro was as it was tested on the way up.
May to make “Important Intervention”
It seems Theresa May will take her political life in her hands next week as she makes a speech that is expected according to various, carefully worded, leaks to update and clarify the U.K.’s Brexit position.
Since the speech labelled an important intervention was first announced by Guy Verhofstadt, the European Parliament’s “Chief Brexit Negotiator” it is likely that it will be positive towards Brussels. It is also going to take place in a major European city.
As an aside, why does the European Parliament have a “Chief Brexit Negotiator”? And what is his relationship with Michel Barnier? Barnier is labelled the European Chief Negotiator. What do they earn Eur 250k each? More? Quite possibly, yet they question why the U.K. wants to leave.
Add Jean-Claude Juncker to the mix at a salary far in excess of those two and it is easy to see why the gravy train keeps rolling.
Oh Mr. Kim; put up or shut up.
Mrs Kim has an almost endless supply of washing up bottles since her son keeps firing them into the sea near Japan.
It is hard to imagine just what Kim’s end game is. He must know that any escalation would lead to his and most of his cohort’s demise. There is no chance of regime change within the ruling party as they all support the radical doctrine Kim represents. After all Kim was educated in Switzerland and it was generally expected that when he replaced his father he would be a more moderate influence on the country. What is they say? Power corrupts but absolute power corrupts absolutely!
The response from Washington Seoul and Tokyo has been muted so far with just Japanese Prime Minister Shinzo Abe stating his country would "never tolerate" such "dangerous provocative action".
The world will watch and wait!