Main currency pairs little changed

It was a very quiet start to the week in financial markets, not helped by a light economic data calendar, In FX, the dollar drifted higher from Friday’s closing levels chalking up modest gains. The euro and sterling are trading at around $1.1675 and $1.3520 respectively this morning, versus $1.17 and $1.3550 at the end of business last week. EURGBP is little changed at about £0.8640. There’s little or no market reaction so far to yesterday’s talks between Trump, Zelensky and European leaders.

Government bond markets were largely uneventful. UK bonds underperformed a touch with yields nudging higher by 3-4bps across the curve, extending last week’s increase, while US yields were flat to very marginally higher and German yields slightly lower.

It was similarly subdued in equity markets with the main US indices ending flat on the day and European stocks off around 0.3%. The latter are doing a bit better this morning, trading slightly higher at the start of play.

Looking to the day ahead, economic data is thin on the ground once again with housing starts & building permits in the US the only release of note.