Dollar a touch weaker

The dollar is a little softer this morning with the euro closing in on $1.21 against the US currency and sterling back above the $1.39 level. This is turn sees the euro-pound exchange rate largely unchanged as it continues to hover just above 86.5p

Equity markets in the US chalked up modest gains yesterday but this was enough to see the Dow Jones close at a new all-time high. In bond markets, both US and German 10-year yields were flat on the day at 1.57% and -0.23% respectively

The Bank of England’s Monetary Policy Committee left interest rates and the size of its bond purchases programme unchanged yesterday (though one member, Haldane, voted for a reduction in the latter). The MPC noted that “new Covid cases…have continued to fall, the vaccination programme is proceeding apace, and restrictions on economic activity are easing” hence “GDP (in the UK) is expected to rise sharply in Q2 (and) to recover strongly.. over the remainder of this year”

Retail sales in the Euro Area rose for a second consecutive month in March, increasing by 2.7% from February to leave them 12% above their level in March 2020

Data due today includes the April employment report in the US with the consensus expecting the economy to have added 1 million jobs this month (following a gain of 916,000 in March) and the unemployment rate to have fallen to 5.8% (from 6% last month)