EUR 9.28 For Business Accounts Only

The Morning Track weak-end

- The Morning Track - Weak End by Bob Savage
http://track.com/articles/the-morning-track-weak-end/

Markets go quietly into that good night of Friday with weekend worriers less dominant than the talk from the IMF/World Bank about Springtime for global growth and the polls for the French election that put Macron 5/6 odds to win the Presidency in May and the first round on Sunday. The EUR is up 1% this week and there is no great fear that the odds are wrong as they were in Brexit or Trump. The tragedy of another terror shooting killing a Paris policeman is taken in stride and ignored. The better French PMI flash reports new 6-year highs show the path forward to recovery with Europe overall growing at 0.7% q/q pace – easily above the perceived US growth rate. The US clings to hopes that the Republican House can manage a tax/healthcare deal as the US Administration from Cohen to Mnuchin to Trump himself all talk about such things. The lift-off in risk yesterday maybe as simple as that – but the weekend will prove critical to such hopes as well. The rise up in GBP fr
om the UK snap election call has faltered a bit today as the UK retail sales missed their mark and higher prices hurt. Consumers can deal with inflation if they get paid more and wages in the UK and US and most everywhere just aren’t keeping up. All of which puts the focus on real rates, central bank hopes for growth and voters into the weekend. The IMF lifted its forecasts for 2017 and 2018 growth but markets aren’t so sure with oil off nearly 3% on the week, gold steady and the VIX holding near 14% no one sees a blindingly optimistic outlook for 2Q without some bumps – the first being the French vote Sunday. The EUR/USD doesn’t reflect any big surprises, so why should other markets care?