Euro a touch weaker

The euro lost a marginal amount of ground to the dollar yesterday. The single currency dipped to touch off $1.18 while against sterling, the euro is trading at 85.5p. The euro remains a little off its lows of the week, reached on Wednesday

US 10 year yields fell again yesterday, down to 1.3%, about 12bps lower from the highs of over 1.4% earlier in the week, equivalent German bond yields ticked down to -0.34%

Inflation was once again a hot topic for Fed Chairman Powell on his second round of testimony on Capitol Hill. He said that the Fed was ‘uncomfortable’ with inflation above 2% but price developments were ‘unique’ due to the shock of reopening the economy and the Fed stood over its forecast that higher inflation would prove temporary but is closely watching to see if this view is proving correct

US industrial production growth was a little weaker than expected in June, rising 0.4% against an expectation of 0.6% while May’s increase was revised a little lower also. Supply shortages may be hampering stronger production activity

Irish GDP growth in 2020 was revised up to 5.9%, from a provisional estimate of 3.4%, partly on foot of stronger exports last year

On the agenda today, the final inflation number for June in the EU, US Retail Sales and University of Michigan sentiment