Dear Reader,

Today's overview of economic news and market action:

• Mixed tone to risk appetite yesterday
• Currency-wise, the action was generally limited
• Euro is slightly firmer over the past 24 hours
• EUR/USD opens this morning up near to 1.10 
• EUR/GBP has regained some modest ground above 86p
• Macro highlight today is US CPI inflation data for July

King of the Hill

The US economy continues to strongly outperform Europe, as it confounds fears that it could enter recession this year. US data have come in well ahead of expectations to date in 2023. This has seen US GDP rise by 0.5% and 0.6% in the first two quarters of the year. By contrast, Eurozone data have disappointed.

ECB raises rates again, leaves options open about further hike

As had been well signalled, the July meeting of the ECB’s Governing Council saw the central bank raise rates by a further 25bps, pushing the key deposit rate up to 3.75%

Still Coming Up Trumps

The US economy continues to strongly outperform Europe, as it confounds fears that it could enter recession this year