Traditional Markets
Two steps forward, one step back. We hope that the escalation are resolved quickly and peacefully. Indeed, according to IDF spokespeople, it will take the Quds months to recover from this. These images of three US prisoners coming home from North Korea is very reassuring indeed.
Speaking yesterday, President Trump announced that a time and place for his meeting with Kim Jong Un have been confirmed and will be announced shortly.
As promised, here are a few charts with the approximate time of the skirmish circled in purple.
Most notable is Oil, which etched out a fresh high…
An arguably larger move was made by gold. However, since the move is well within the current trading range, it is not as significant as the oil move.
The US Dollar pulled back slightly and is now testing its upward trend line.
The Bond markets were closed when all this happened but it should be noted that the 10 Year Yield has been rising over the last week and is again flirting with the significant 3% mark.
With all this going on, you'd think that some of the risk would be coming off the table, but to the contrary, stock indices have been rising like it's 2017 and stock market volatility is at it's lowest levels since the beginning of February.
Super Thursday
Although the Bank of England is not expected to raise their interest rate today, their meeting will be anything but boring.
The term Super Thursday in the UK usually refers to a day when several critical elections converge. More recently, it seems the definition has also grown to cover when the Bank of England releases several concurrent announcements. And why not, it's a catchy title and today's updates have certainly been well anticipated.
At high noon in London, a slew of reports will hit the markets like a ton of bricks and we hope the Sterling doesn't suffer as a result.
As we said, the Official Bank Rate is likely to remain at 0.50%. However, this is a relatively recent expectation. Last month, the expectation of a rate hike from the BoE was as high as 90%, but after some weak inflation data, Mark Carney was forced to walk those expectations back and this morning it's down to 12%.
