Morning Report

August 21, 2023

“UK house prices declined notably due to rising mortgage costs affecting seller expectations, accompanied by a decrease in job vacancies and advertised starting salaries, indicating heightened employer caution. The dollar remains strong ahead of the Fed’s Jackson Hole Symposium, where all comments from officials will be closely analysed.”

Sam Cornford, Partner – Head of Trading

Main Headlines

US counterintelligence agencies cautioned the American space sector about foreign intelligence attempts to steal research and trade secrets, aiding their own national space initiatives. Companies were alerted to be wary of potential facility visit requests, data collection at conferences, as well as the risk of employee recruitment through travel offers or consultancy payments for proprietary data. In other news, President Biden, alongside South Korea and Japan’s leaders, reached an accord at Camp David on Friday, strengthening military and economic collaboration as they issued their most forceful joint criticism of China’s “dangerous and aggressive behavior” in the South China Sea.

British Prime Minister Rishi Sunak is revising his September cabinet reshuffle plans. He has indicated towards addressing vacancies left by ministers who’ve expressed their intent to step down, like ex-Defence Secretary Ben Wallace, rather than a sweeping reshuffle. In other news, about 13,000 drivers from 16 train companies will participate in a walk out on September 1st, followed by an overtime ban the next day. ASLEF rejected an 8% pay increase over two years offered in April. The union is dissatisfied since most drivers haven’t received a pay raise for four years.


Sterling is weaker against than most major currencies this morning. Earlier, Rightmove published their House Price Index report which is the earliest report on housing inflation. It showed a steep decline from previous months, with a 17bps deviation below last month’s figure to -1.9%, which is the lowest figure since December 22. In other news, The UK labour market is cooling as July saw a decline in vacancies and advertised starting salaries. While jobseekers per vacancy increased slightly, the labour market remains largely constrained, with indicators showing employers are growing more cautious about hiring.


The Euro is well bid against most major currencies overnight. This morning the German Stats Office released their PPI report, which is the leading indicator of consumer inflation. The last few months have not shown any clear trend, however this report was worse than most with a 10bps deviation below forecast to -1.1%. Later today the Bundesbank will release their monthly report which provides detailed analysis of current and future economic conditions from the bank’s viewpoint. Normally the impact tends to be larger when they clash with the ECB’s current stance, so we will see what viewpoints the report brings.


The Dollar is slightly weaker than the euro but stronger than sterling in the early morning trade. The currency continued five consecutive weeks of strengthening as investors are focusing on the Federal Reserve’s Jackson Hole symposium for insights into future interest rate levels post-current hiking cycle. In other news, the US 10-year Treasury yields reached their peak since October late last week, and U.S. real yields, reflective of inflation-adjusted earnings from government bonds, hover around their highest point since 2009.


European stocks climbed in muted trade on Monday as gains in energy companies outweighed concerns over mixed policy signals from China. TotalEnergies SE, Shell Plc and BP Plc were among the biggest contributors to Europe’s Stoxx 600 equity benchmark as crude oil rose for a third day and gas prices jumped amid threats of supply disruptions from a potential strike in Australia. Trading volumes were about a third lower than usual. US futures contracts were steady. A gauge of Asian stocks dropped for the seventh day in the longest losing streak since June 2022. The Hang Seng Index declined as much as 2% and shares in mainland China fell 1.4%.

Main Economic Data/Central Banks/Government (All Times CET)

10:00 p.m.: Switzerland Total Sight Deposits
10:00 p.m.: Poland July PPI

Corporate Events

Earnings include Zoom Video


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