Dollar slightly firmer

The euro has slipped to $1.17 against the dollar as European equity markets lose ground with sterling weakening to $1.29 against the US currency, leaving the euro-pound rate hovering just below 91p. Stocks in Europe closed down almost 3% yesterday while core bond yields headed further south with German 10-year yields now trading at around -0.62%

European leaders have instructed Michel Barnier to continue negotiations with the UK and called on the latter to move on key issues. The UK’s David Frost has said he is “disappointed” with the EU’s stance, while Prime Minister Johnson will make a statement later today – he is not expected to call off the talks, as he has threatened to do, but is likely to reiterate that the UK is still prepared to proceed without a deal

ECB Preident Christine Lagarde says economic indicators for the Euro Area point to “a strong rebound in activity in the third quarter…(however) this rebound is nevertheless uneven across sectors and regions, and a further sustained recovery remains highly dependent on how the pandemic will affect consumption, savings and investment decisions”

The number of continuing jobless claimants in the US continued to fall at the start of this month, which points to an on-going rebound in employment after it collapsed in March-April

Data due today included retail sales, consumer confidence and industrial production in the US