PREVIOUS TRADING DAY EVENTS 21 June 2023

All eyes were on the inflation data released yesterday early during the start of the European session. Annual inflation was reported unchanged, at 8.7 while Core inflation was reported higher at 7.1 more than expected. 

A huge surprise for policymakers who, despite the continuous interest rate increases, inflation remains stubborn. A warning for all economies. This release now puts more pressure on the Bank of England. Today it is expected to raise interest rates for the 13th time in a row.

Sources say that there is a 40 chance of the BOE to raise interest rates from 4.5 to 5 and a nearly 100 chance rates will reach 6 by December, even as the economy skirts recession. This would mean a surprise today and GBP to strengthen significantly.

Finance minister Jeremy Hunt said the government would stick to its guns on cutting inflation.

Source httpswww.reuters.comworldukukinflationrateunchanged87maycontraryforecastfall20230621

Fed Chairman Jerome Powell testified about the SemiAnnual Monetary Policy Report before the House Financial Services Committee, in Washington DC yesterday at 1700. During the speech, the USD was steadily weakening.

Inflation has moderated somewhat since the middle of last year, with the Feds preferred measure of inflation falling substantially from a peak of around 7 last year to 4.4 as of April.

Inflation pressures continue to run high, and the process of getting inflation back down to 2 has a long…