Fed steps closer to rate cut, as Biden comedy roadshow continues
US Inflation posted a lower than expected figure for the second month in a row, as consumer prices fell for the first time in four years in June.
With many analysts predicting an uptick in prices, the 3% reading beat expectations (3.1%) and clears the way for a rate cut in September by the Federal Reserve.
Sterling took advantage and hit levels not seen against the Dollar in almost a year, as traders price in a reduction in policy from the States ahead of the UK. Traders are now evenly split on any potential rate cut from the BoE at their next meeting in August, following Chief Economist Huw Pill’s comments that he was not in favour of cutting rates yet. The pound also gained strength from impressive GDP readings showing the economy grew 0.4%, with some investment houses now increasingly confident Sterling could make further gains, with arguably the most stable government in the G7 after the recent election.
Meanwhile, across the pond President Biden continued to make not one but two clangers at the NATO summit overnight, as clamour amongst Democrats to replace the 46th President intensifies. Biden’s timing could not have been worse in a high stakes meeting, with the worlds eye’s watching him refer to Ukraine’s President Zelensky as “President Putin”, shocking leaders around him. He then referred to his own Vice President Kamala Harris as “Vice President Trump” adding further salt to the wound.
Biden came out fighting afterwards, doubling down on his Presidency reiterating that he will be the Democrats best hope of taking the fight to Donald Trump, who lapped up the excruciating gaffes, mocking the president with “Great Job, Joe!” as he shared the disastrous clips.
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