Initial reflections on the US Mid-term elections

Last Tuesday the US went to the polls in a set of major elections. Voters were choosing a new House of Representatives, a third of the Senators and many state-level offices.  Despite the President not being on the ballot, these elections received worldwide attention because their outcome could have a major impact on US policy.  […]

Who actually sets interest rates around the world?

Given the ongoing economic crises in various countries around the world, attention at the moment is rightly more focused on interest rate decisions than in normal times.  The process for raising or lowering interest rates varies from country to country. For some, it’s a pretty simple decision made by the Finance Minister, for others, it […]

How did the US Dollar become King?

When it comes to currency, the US Dollar dominates all the others. No currency comes even close to having a similar power. The dollar accounts for nearly 60% of world foreign currency reserves and trillions of dollars of daily FX transactions. When this currency moves, the rest of the world takes notice. The Dollar’s reign […]

August was officially Sterling’s worst month since Brexit

As September began yesterday, we saw the official conclusion that August had been the worst month for Sterling since the aftermath of the Brexit referendum. August started with Sterling sitting at £1.21 to the US Dollar but over the course of month saw a slow and steady decline, ending down at £1.16. Not a good […]

GDP falls for the second quarter in a row.

This week has been considerably quieter economic data front, perhaps a relief given the volume of negative news recently. US inflation figures were released on Wednesday with consumer prices rising 8.5% in July, the rate of increase has been calmed slightly as fuel prices fell. No increase was recorded in CPI between June and July, […]

BoE Governor: Expect 13%+ Inflation and a Recession!

The key update of the week is that the Bank of England has increased its interest rate by 0.5%, the largest increase since the Bank’s operational independence in 1997.  The rate rise comes on the back of a dismal economic forecast by the BoE that forecasted inflation rates of 13% by the end of the […]

Fears of recession loom as inflation spirals and confidence declines

This week has been dominated by the fears of a looming recession following the release of key GDP and confidence data. Significant news was released on Thursday when it emerged that the US economy shrank for a second consecutive quarter. This technical recession is due to a 0.9% GDP contraction for Q2 following a 1.6% […]

Euro hits parity with USD for first time since 2002

Unsurprisingly, inflation continues to be the topic of the moment with figures announced Wednesday showing US prices rising 9.1% in June compared to a year ago, the highest rate in 40 years. Wednesday’s result was surprisingly higher than consensus estimates of 8.8%. Inflation continued to be led by large food and fuel price increases but […]

Markets react to the resignation of Boris Johnson

This week’s major story is that British PM Boris Johnson has resigned after 59 of his ministers quit within 48 hours. The flurry of resignations followed news that Mr Johnson knew about a history of sexual misconduct concerning Assistant Whip Chris Pincher. Mr Johnson intends to remain as PM until the autumn. Sterling reaction to […]

Which other countries use the US Dollar as their currency?

The US Dollar is the world’s major reserve currency. It is estimated that over 55% of all currency held in reserve by Central Banks is in USD. Given the strength of the US Dollar, it is unsurprising that some countries actually use the currency of the USA as their own domestic currency. Not including territories […]