Will China and US make up? Will Tump and Xi get what they want? Uncertainty prevails on both sides of the Atlantic, as the UK awaits the impact of a new government spending review. GBP and USD performance hangs on a knife edge. Europe, is it EUR time to shine? Let’s find out.
Current rates
| Currency pair | Rate |
|---|---|
| eur usd | 1.1420 |
| gbp eur | 1.1877 |
| gbp usd | 1.3565 |
Rates correct as of 9:19am on Monday 9th June but may now have changed.
The Big 3
Three stories covering the latest developments in economies, currencies and borders.
US China trade talks resume
Talks between the US and China will restart in London today, with rare-earth minerals and advanced technology the focus. This follows discussions between President Trump and President Xi Jinping over the phone last week. De-escalation in trade tensions began with a deal in Geneva in May but there have been complaints on both sides since then. The hope is that these talks will reach a firmer conclusion.
The UK spending review - where's the money going?
All eyes on the Chancellor's government spending review this week as we find out who gets a share of the £113bn capital funding. Of course there will be cuts to cover this, creating mixed feelings on the whole exercise. Energy, transport and infrastructure will be the main things covered. A bad reaction to this could cause pound sterling to fall after an otherwise positive week.
ECB cut interest rates by 25 bp
As expected, the ECB cut interest rates by 25 basis points following the latest council meeting. As a result, there was more hawkish rhetoric with an indication that there would not be a cut in July. Uncertainty generally benefits the Euro as it is turned to as a backup.
Recap
How the Euro could become an alternative reserve
The US dollar is on course for its worst annual performance since 2017, and appears to be losing confidence as the world's no.1 reserve currency. What would it take for the Euro to take this crown? There's certainly plenty of signs that it could grow influence beyond the region.
Looking forward
Monday - Inflation data - CNY
Tuesday - Employment data - GBP
Wednesday - Inflation data - USD
Thursday - GDP MoM data and more – GBP
Here's what we're talking to our clients about
We’re always here to support. Here are some of the conversations we’re having:
- We’ve got the post-Money2020 blues - but have lots of great conversations to follow up on.
- The USD rate and it's latest retreat.
- What happens if the UK interest rate changes more or less quickly than anticipated?
The contents of this article do not constitute financial advice and are provided for general information purposes only.
