Dear Reader,

Today's overview of economic news and market action:

• • Marked easing in market interest rate expectations last week … 
  • Against this backdrop, there was some volatility on currency markets …
  • The dollar was holding a firmer tone, but was unable to hold onto all of its gains … 
  • EUR/USD opens this morning below the $1.08 threshold … 
  • GBP/USD is in the lower half of $1.26-1.27 … 
  • EUR/GBP is operating at the midpoint of 85-86p …
  • Turning to the week ahead, there is a very quiet data schedule …
  • However, remarks from a number of central bank officials may impact sentiment …

Payback Time

The National Accounts data from the CSO for H1 2023 show that the rate of growth in the Irish economy has decelerated markedly from the breakneck speed seen in 2021 and 2022.

PMI declined to 47.0 in July, as business conditions softened for a fifth consecutive month. New orders, and output fell. Meantime, there was a further easing in price inflation

Economic data, especially on labour markets, have generally surprised to the upside to date in 2023. Global economy, though, still facing considerable headwinds, with risks to the downside.

Downside Risks Still Prevail for Global Economy

Surging inflation combined with a marked tightening of monetary policy, amid an environment of weakening confidence levels and heightened geo-political tensions, especially in relation to Ukraine, saw the world economy slow sharply during 2022. However, concerns that advanced economies could be facing a recession in 2023 have largely abated.