Insider Comments

The following Insider Comments page is designed to provide a short opinion on topical subjects that we consider to be of particular relevance to both existing and potential clients of JCRA.

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Comment  »  

While the GBP/USD exchange rate is not far off purchasing power parity, the pound does feel weak against the EUR, as any trip to the eurozone will confirm.

Unfortunately, about half of all food consumed in the UK is imported, much of it from the eurozone. Either supermarket profits or the consumer will be squeezed by the strong single currency – most likely both.

In the beleaguered eurozone itself, we learnt last week that CPI had risen to 2.6% and in contrast to the UK, where weak data has pushed out market expectations of a rate rise until late summer, a 25 basis point rise this week in the ECB refi rate is now regarded by the market as a racing certainty.