Euro slipping

The euro has slipped against the dollar to trade closer to $1.08 this morning, and is also lower against sterling trading back below 87p. The pound, meanwhile, is not much changed against the US currency just above $1.2650.

Government bond yields continue to nudge higher. US 10-year yields are approaching 3.60% and equivalent UK yields are up to 3.85%, with German 10-year yields now trading a little below 2.40%.

US stocks closed higher yesterday, with the S&P 500 gaining more than 1%, helped along by remarks by President Biden, who said he’s “confident that we’ll get the agreement” on the debt ceiling and that “America will not default.”

Bank of England Governor Bailey says, while CPI inflation is expected to “fall quite sharply as energy costs begin to ease, the outlook for inflation further out is more uncertain and depends on the extent of persistence in wage and price setting.”

The annual rate of CPI inflation in the Euro area was confirmed at 7.0% in April, according to the final reading published yesterday, with the inflation rate excluding energy and food confirmed at 5.6%.

Economic data due today includes jobless claims and existing home sales in the US.

 

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