US economy expands in Q1

The euro and sterling are both a touch softer against the dollar from where they were yesterday morning, trading at $1.21 and $1.39 at the off today, while the single currency is a tad firmer against the pound at 87p

European and US stocks chalked up modest gains yesterday, though this was enough to see the latter close at new all-time highs. In bonds, German 10-year yields nudged up to -0.20% while equivalent US yields ended the day flat at 1.64%

The pace of growth in the US picked up in the first quarter of this year with GDP increasing by 1.6% after rising by 1.1% in the final quarter of last year. GDP remained below its pre-pandemic level, though it is likely to surpass it in the current quarter (Q2)

ECB Chief Economist, Philip Lane, says the Euro Area economy is at an “inflection point”, noting that the first months of this year have been dominated by measures to contain COVID-19 but with “vaccinations now having made progress, we do see a good rebound, a good recovery throughout the rest of this year”

House prices in the UK rose by 2.1% in April according to the Nationwide measure, with the annual rate of increase picking up to 7.1%

Data due today includes a first estimate of first quarter GDP in the Euro Area, with the consensus expecting the economy to have contracted by 0.8%, as well as CPI inflation and unemployment, while consumer spending and PCE inflation are released in the US