Not only does the UK wake up to a football team in the Euros 2024 Final. but the economy is also in better health as well, the GDP figure just released showed the UK economy growing 0.4% in May, above the consensus 0.2%. The main news overnight is still equity related with the S&P 500 and Nasdaq 100 each gaining more than 1%, spurred on by the likes of Nvidia and Apple.
I would like to revisit a couple of stories from yesterday, namely the much weaker than expected Czech CPI print - the currency has weakened taking the rally in EURCZK to +3.50% since mid-June. And a similar story in Norway, weaker CPI print which at 2.60% y/y is the lowest since Jan 2021, and EURNOK has rallied. Both cases highlighting that the fight against inflation might well be coming to an end. This leads us nicely on to the main data point today - the US CPI at 13.30. This number, which excludes food and energy costs, is seen as a better measure of underlying inflation, and is expected to rise 0.2% in June for a second month. Will this undershoot? That would mark the smallest back-to-back gains since August — a pace seen as palatable for Fed officials. Jerome Powell told Congress that the Fed doesn’t need inflation below 2% before cutting rates, and that officials still have more work to do, but a weaker number would help the 'cutting cause'.
As for the markets: the yield on 10-year Treasuries is at 4.29%, West Texas Intermediate crude rose 0.8% to $82.75, a barrel's pot gold rose 0.4% to $2,381.53 an ounce, Bitcoin rose 0.6% to $57,745.81, Ether fell 0.4% to $3,084.76 and the Proud Pounds opens at 1.2860.
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