Good morning.
Sterling retreated again today after a strong bounce against the dollar on Wednesday.
The pound rose the most since mid-June on Wednesday, dragging the euro down with it, after the Bank of England carried out the first of its emergency bond-buying operations, worth more than £1 billion. pounds sterling
Sterling was down 0.9% at $1.0789 mid-session in Asia this morning, losing some of the previous day’s recovery. The euro also weakened to $0.969, after Wednesday’s 1.5% gain, the biggest since early March.
Sterling had fallen to a record low of $1.0327 on Friday as investors issued a scathing verdict on Kwasi Kwarteng’s plan for record tax cuts financed by a massive increase in borrowing.
The euro had fallen to a new two-decade low of $0.9528.
5 things to start the day
1) Pension fund crisis forces Bank to bail out £65 billion The Bank warned of a “material risk to UK financial stability” and stepped in to buy long-term gilts.
2) Yellen reassures on health of global economy after IMF stokes UK contagion fears US Treasury secretary insists financial markets are ‘doing well’ as stocks in Europe and Wall Street recovered.
3) UK trade and travel at risk of ‘rapid’ fall if Brussels refuses to ease imminent border controls Biometric checks to be introduced next May, replacing ‘wet stamp’ of passports
4) EDF considers keeping UK nuclear plants open longer to boost power supply The French state-owned company said it will review its current plans to close Hartlepool and Heysham 1 in March 2024.
4) Russia forced to use own aircraft technology to supply fleets The country is trying to revive its accident-prone Cold War-era aircraft industry after being hit by Western sanctions
What happened during the night
Asian stock markets rose on Thursday after the Bank of England launched an emergency bond-buying program. The move boosted sterling and offered some comfort to the jittery mood in markets, but by mid-morning in Tokyo the pound was already struggling for support and was down 0.6% at 1, 0818 dollars. The broadest index of Asia-Pacific shares outside Japan rose 1.5% and was looking for its best session in a month. Japan’s Nikkei rose 0.9%, while the Hang Seng rose 2%.
It arrives today
- Economy: Consumer Credit (UK), Mortgage Approvals (UK), Gross Domestic Product (US), Initial Jobless Claims (US), Consumer Confidence (EU), Economic Sentiment Indicator (EU )
- Corporate: Mcbride (final results), Next, Synairgen, Novacyt (interim), Mitchells & Butlers (business update)