Dollar gains ground

The dollar has gained some ground against both the euro and sterling, strengthening to around $1.0450 and to $1.22  respectively. This in turn leaves the single currency-pound exchange rate not much changed trading at just over 85.5p

European stocks have reversed course following yesterday’s solid gains, down almost 2% or so in early trading this morning, while US equities closed almost 2% lower yesterday

Government bond yields continue to head south, with US and German 10-year yields about 10bps lower at 2.84% and 0.88% respectively and equivalent UK yields down to 1.73%

ECB President Christine Lagarde in a speech yesterday indicated that the central bank will begin to raise interest rates at its July meeting

The UK economy expanded by 0.8% in the first quarter of this year according to data published this morning, though it ended the quarter on a soft note with GDP falling by 0.1% from February

The annual rates of headline and core CPI inflation in the US dipped slightly in April, to 8.3% and 6.2% respectively from 8.5% and 6.5% in March

Data due today includes producer prices and jobless claims in the US