Starmer reported to be close to resigning

Good morning

Well that was a warm weekend, and there is plenty more warm weather on the way with temperatures here forecast to hit 36°c or so through the week before cooling down to a more reasonable 27°c by the weekend.  Best not complain mind you, we’ve had the longest day so our hours of sunshine can only get shorter from here.

In weekend sport other than World Cup action, New Zealand beat England in the second test match with a dominant performance that punished England, who were missing Stokes and Atkinson who has been dropped their drunken antics in a nightclub after the first test.  They will return for the third test that starts on Thursday. In golf, Wyndham Clark held his first round lead to win the US Open despite a final round wobble that threatened to derail his wining chances. 

As well as the weather, things are hotting up in UK politics as well following Burnham’s by-election win last week. The press is full of stories of Starmer’s possible resignation as his support within the party fades.  Some talk of Ed Miliband becoming Chancellor should Burnham become PM could unsettle markets amid waning investor confidence over concerns of growing borrowing.  Still we don’t necessarily need Burnham or Miliband to create uncertainty, news that ONS have admitted an error over jobs numbers which is likely to lead to downward adjustments brings into question the reliability of UK data gathering.

GBP remains reasonably stable having lost a bit of ground against other majors last week.  GBPUSD is hovering around 1.3200, GBPEUR is at one month lows at 1.1525, against AUD, NZD and JPY it is 1.8850, 2.3055 and 213.40.  EURUSD is 1.1445, USDJPY up at 161.75 with Japan FinMin Katayama warning once again that they are ready to act whenever necessary. 

Peace talks between US and Iran are reported to be making progress although there was talk over the weekend that Iran had closed the Strait of Hormuz over Israel’s continued attacks on Hezbollah targets in Southern Lebanon.  Still, equity markets don’t seem overly bothered and oil prices have dipped again after a bit of a spike on the open. 

This week brings global PMIs, Canadian and Aussie CPI, Aussie employment and the main event, the US core PCE number, even though we know it is not one of Warsh’s favourites inflation measures.  Today is a busy one for ECBs Lagarde who appears on the calendar three times.  Aussie PMI’s due overnight.  In the meantime look out for any Starmer resignation talk…

Have a great day…

-  09.00 ECBs Lagarde speaks

-  13.30 CAD CPI

-  14.00 ECBs Lagarde speaks

-  14.00 Feds Waller speaks

-  15.00 EU consumer confidence

-  16.15 ECBs Lagarde speaks

-  00.00 AUS S&P services, manufacturing PMI