Daily update
Daily update
- Yesterday, US Vice-President Vance denied being the “fall guy” for the position the US finds itself in with Iran, but has chosen not to fly to Switzerland for talks at the moment. Markets assume delayed negotiations would just extend the ceasefire, and are fixated on the volume of shipping (and oil) through Hormuz.
- UK consumers showed not so much resilience as joie de vivre in the May retail sales numbers—another notably stronger-than-expected reading. Unusually warm weather helped push the numbers higher (the data adjusts for inflation, so this was a genuine desire to buy more stuff).
- UK politics is not expected to change anything of substance in the near term (it might lead to a change of prime minister, however). The mayor of Manchester won a by-election, confirming investor expectations of a challenge to Prime Minister Starmer at some point. Tactical voting produced defeat for the far-right party, Reform UK, and further instances of tactical voting make predicting future elections difficult.
- There have been some global inflation signals. Japan’s May national consumer price inflation data was exactly as expected, and does not offer guidance on the timing of any future policy changes. German May producer price data was weaker than expected, emphasizing the ECB policy error.