Dollar firmer

The dollar is a little firmer this morning, helped by stronger than consensus US economic data, trading at just over $1.1150 to the euro and at around $1.1260 against sterling. The pound is little changed against the single currency – it continues to hover just above the 88p level – and seems to have stabilised for now after its sharp enough fall over the past three weeks or so

Bond yields in the US continue to fall, with 10-year yields closing 5bps lower yesterday and declining a further 5bps points overnight to just over 2.2% (which is some 100bps below their most recent high of 3.25% set in November last year). Yields in the other core markets are following suit – German 10-year yields have fallen further into negative territory at -0.17%

Consumer confidence in the US rose strongly in May, notwithstanding all the headlines about trade tensions, helped by a positive assessment of current labour market conditions, which is perhaps not too surprising considering the unemployment rate – at 3.6% – is at its lowest level since the 1960s

The Speaker of the House of Commons has indicated he would make sure parliament has an opportunity to stop the UK leaving the EU without a deal if MPs believe it should be halted. “He has said “the idea that parliament is going to be evacuated for the centre stage of debate on Brexit is simply unimaginable..the idea the House won’t have its say is for the birds….there is a difference between a legal default position and what the interplay of different political forces in parliament will facilitate”

Inflation in France fell back in May – to 1.1% from 1.5% in April – suggesting inflation for the Euro Area as a whole will do the same, after it jumped to 1.7% in April