The ‘symbolic olive branch’, as Reuters call it, was given to the German central bankers who have been highly critical throughout Mario Draghi‘s time of just how low interest rates are and how much money has been printed. Ms Lagarde may have shown signs of willingness to change, but hasn‘t taken any steps to indicate what changes might be brought during her tenure. She’s awaiting a full review of monetary policy before implementing any new strategies (unsure how that would be substantive given it’s largely been an experiment with longer term consequences) but it also seemed from previous assertions ahead of her taking the job that it would be more of the same – having urged Germany and The Netherlands to open up their cheque books and get spending.
Another maiden speech from someone in a new job came from new commons speaker Sir Lindsay Hoyle. Sir Lindsay beat fellow Labour MP Chris Bryant to the job, with 325 votes to Mr Bryant’s 219. Taking the head of the table he vowed that “this House will change, but it will change for the better”. He’s only going to get today in the job and then a bit of rest as parliament is set to be dissolved just after midnight tonight (the irony of this being Guy Fawkes night probably isn‘t lost)
Once parliament is dissolved, MP’s will waste no time in taking their message to the masses. Jo Swinson is already making sure that she can deliver the LibDem message in front of a national audience, by taking legal action to get onto the ITV debate between Corbyn and Johnson. ITV had previously intended for it to be a head to head between the two possible candidates for Number 10.
The remain parties of the Lib Dems, Greens and Plaid Cymru are planning an alliance to make sure they don’t split the vote in areas where a particular candidate is strong and in a position to be elected. This will work for some seats but, as the BBC points out, there are plenty of seats that even combined votes won’t be able to overturn – and in Wales there are plenty of remain supporting Labour MP’s, who won’t be making a pact (or able to influence Corbyn if he does get into power!)
The same is planned in Northern Ireland with the DUP looking at a very uncomfortable election battle ahead of them as a result.
is having a larger impact on the island of Ireland than it is in the UK. Consumer sentiment is at its lowest level in more than six years and the services sector is limping along at its slowest pace since 2012. North of the border, Belfast has announced ambitious plans to try and double the size of its tourism industry over the next ten years. Last year tourism made just under a billion pounds, but they’ve set plans in place to try and get that up and in the process hope to create thousands of jobs. The CEO of Tourism Northern Ireland compared their project to a Skoda car; “the product is fantastic, but the image has maybe not kept up with the product” – he has been hampered in getting on with the task at hand by having no sitting executive in Stormont for the last three years. Full story is here.
Some good news out of the US-China situation; both sides are looking at rolling back some tariffs in a bid to get the first stage of an agreement across the line. The hope is that by rolling some back and seeing progress, this sparks a wider reduction and increased impetus. The result is the S&P continuing into fresh ground and the Shanghai Composite also having a good day of it so far today. Here’s hoping Trump has enough index linked ETF‘s that he sees the
profit progress and decides to carry on!
Just as the optimism levels creep up in the US with both the trade war thaw and the Fed rate cut from last week, so we might see it unravelled by Washington later this month… We’re back to another spending showdown and with Trump’s impeachment proceedings, expect the partisan approach to be even more deeply entrenched. The last shutdown, at the end of last year, was the longest in US history and the border wall was the bargaining chip. Bloomberg has the story.
Elsewhere in the world; we saw Australia keep rates on hold overnight, but accompanied with comments from the Governor that low rates will be around for an extended period. Goldman Sachs are predicting that the government will also be embarking on fiscal stimulus measures in the form of tax cuts. They argue that being so far away from inflation targets and their ambitions for full employment might even lead to some kind of QE – but that’s not the base case. This is worth a watch.
Have a great day.