Markets take UK GDP in their stride

If I didn’t know better, after reading the press around UK GDP data, I would have believed the Pound had been wiped off the face of the planet. ‘Sterling Tanks’, ‘Pound Dives’ they shouted but that was not true at all. The fact that the UK economy contracted by 0.1% in the month to March is not a good sign at all but a recession is measured by two full quarters (6 months) of contraction and the NIESR estimate for the three months to April is 0.3% growth. So the markets took that 0.1% contraction on board and moved on. The whole planet is suffering the consequences of the Russian aggression and the sanctions that followed, so why should Sterling be singled out as the currency to sell when it is already very affordable. At just above USD 1.22, sterling is exactly where it was before the GDP data and at EUR 1.1750, it is 1.5 cents above yesterday’s low. We lack UK data today, so range trading is the most likely outcome.

USD pauses on rise in jobless claims

203,000 fresh claims were made for US unemployment welfare payments in the last week and that was above market expectations. Whether that would be enough to cause the Federal Reserve a moment of concern is not clear but their commitment to 2 or 3 more 50 basis point interest rate hikes could come into question if unemployment starts rising significantly. The US Dollar barely shifted on the news. The USDJPY rate dropped to JPY 127.50 but bounced to JPY 128.7 overnight. However, the EURUSD rate remains below $1.04, having hit another new 5-year low yesterday.

Calm yourselves, Paraskevidekatriaphobics

Yes, it is Friday the 13th and some, not all, of us fear the date combination. True, the 13th guest at the last supper was Judas and that seems to be the cause of much of the superstition but the number thirteen seems to be feared largely because it isn’t our beloved twelve. We have 12 signs of the zodiac, 12 months in a year, we’ve split a day up into two twelves, Hercules had 12 labours, Israel had 12 tribes and Jesus had 12 apostles. There are 12 days of Christmas. 12 inches in a foot, we buy roses by the dozen and eggs likewise. There are 12 royal cards in a deck and the list goes on. So just NOT being 12 seems to be thirteen’s problem. But if we didn’t use the Gregorian calendar, as opposed to the dozens of other calendars in use over the centuries, this wouldn’t be Friday 13th at all. Have a great day, it’ll be fine.

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