- Sterling stable
- Euro hit by poor German data
- Shocking Japanese Gross Domestic Product contraction
By David Johnson
Sterling stood its ground yesterday amidst a number of news events. The level of employment reached another record high in Q1. 31,200 new jobs were created in the first quarter, keeping the unemployment rate at just 4.2%. By any economic calculation, that is pretty much full employment. There is nothing of note in the diary today for the UK economy, so a bit of consolidation is likely.
Bad day for the Euro
The Euro had a pretty poor day after German Gross Domestic Product (GDP) growth fell back from 2.3% in Q4 to just 1.6% in Q1. With Germany being the shining light economy in the Eurozone, it was inevitable that the Euro would slip, and it did. In spite of an improvement in Europe-wide industrial production (albeit below forecast}, the shared currency is down against the US Dollar and the Pound, amongst others.
Dollar dodges disappointing data
For its part, the USD remains strong. US retail sales data was disappointing, but the forecasts for today’s industrial production numbers are solid enough. Assuming the data meets the forecasts, the US Dollar should hold its ground.
Japanese Yen suffers growth shock
The Japanese Yen was volatile overnight after a shockingly bad economic growth report. The Japanese economy shrank by 0.6% in the year to March; the first contraction in the economy since 2014. However, industrial production rose a little in the month of March, so maybe things are looking up…
Australian consumer concerns come to the fore
We also heard overnight that neither Australian consumer confidence or the wage price index managed to show any growth in May or Q1 respectively. In fact, the minus 0.6% on the Consumer Confidence Index is the same as April. They aren’t happy, those Aussie shoppers. The Sterling – Australian Dollar exchange rate rose only marginally, because these were very much in line with expectations.
The day ahead is another one for central banker speeches. Members of the European Central Bank (ECB), the US Federal Reserve and the Bank of Canada will be in action. Well, I say ‘action’, but you know what I mean.
And the Principal of Christopher Columbus High School in Miami has seriously misjudged the zeitgeist at his school’s prom night. The jungle theme was good but bringing a full grown tiger into the arrangements and placing the poor animal in a little cage was definitely not a good move. Quite rightly, he has received a ferocious backlash.