EUR 8.46 For Business Accounts Only

The Morning Track in-stride

- The Morning Track – In Stride by Bob Savage
http://trackresearch.com/articles/the-morning-track-in-stride/

Taking it all in stride – markets are waiting for the ECB and the Trump/Juncker trade discussion – with some hope for deals and so they are willing to move over the geopolitical fears that remain. The US President suggested the EU should drop all tariffs and trade barriers ahead of the talk while EU Malmstrom said they were read to levy $20bn tariffs on US goods, but hopes to find a solution. The Italian President is trying to shield FinMin Tria – adding to political hopes there, while UK May is taking over the Brexit team and negotiations – increasing the probability for a soft Brexit. The US President also was open to a quick NAFTA deal with Mexico and even talks with Iran. Deal making abounds, but you need to take this all in stride as the data overnight highlights the mix with German IFO lower but not as bad as feared, with UK CBI retail trends lower but not as bad as feared. With PPI up in France and Spain but not fully fed into consumers while the opposite
appears at play in the US after the Markit flash PMI. There is still an underlying fear about inflation knocking markets off-track but the deflation from Asia remains and the ongoing talks about China stimulus and BOJ tweaks matter. The days ahead seem to matter more than the present and that is clearly the problem as momentum stalls and ranges narrow with lower volumes – proving in summer that walking fast only makes for more sweat and less returns. Focus on risk today revolves around the EUR thanks to the EU talks and ECB tomorrow – leaving anything over 1.1770 or below 1.1620 interesting, otherwise keep walking (slowly.)