Daily update
Daily update
- Last week’s Axios newswire report that Iran and the US were “moving towards” a deal have (again) proved to be less than accurate. US President Trump declared Iran’s response to US peace overtures to be “TOTALLY UNACCEPTABLE”. The basic problem for markets remains—reopening the Strait of Hormuz depends on Iran, there is little information about the Iranian government’s position, and information from other sources (including the US) cannot be considered reliable.
- China’s April consumer and producer price inflation were higher than expected, with energy-related costs offsetting food price declines. China’s government exerts considerable control over energy prices. Allowing prices to increase might suggest a desire to slow demand—possibly motivated by a belief that supply disruption will continue for some time.
- The scheduled summit between China’s President Xi and Trump, due to start on Wednesday, has little impact in financial markets. China has little incentive to pursue “gold bar diplomacy,” and social-media-ready statements on investment or soybeans are rarely taken too seriously by investors.
- UK politics is exciting some interest amongst the handful of investors that care. Local election results saw gains for the far right and nationalists—“anti” parties whose policies tend to focus on being against things. Investors are concerned that countering that might cost money.