Does getting muddled matter to markets?
- US President Trump admitted to having been a bit muddled in Helsinki, and agreed with US intelligence services that Russia meddled in the 2016 election. The president's clarification followed criticism by US Republicans, and media reports that Russian officials were concerned about worsening Russia-US relations in consequence.
- Does this matter for markets? This time, it might. Trade is the issue. The US president has considerable authority over trade – if muddled over Russia, US President Trump may be muddled on trade, creating uncertainty. Moreover, Republicans in Congress are talking about taking back control of trade from the president, adding uncertainty.
- US Federal Reserve Chair Powell raised trade in remarks to Congress yesterday. The central case for steady policy tightening was restated. Today's Beige Book (an economist's gossip magazine of anecdote) may be a more important focus for markets looking for the effects of trade taxes and uncertainty.
- UK inflation data is due – mildly interesting with uncertainty about when the Bank of England will raise rates. Markets have been reacting to the interminable process of the UK getting out to the EU, with the government winning a key vote in parliament through support from rebellious members of the opposition.