There’s a week of politics and policymakers ahead of us, with important signals as to the future of monetary policy at the Jackson Hole symposium, the “return to normality” from Covid, Trump’s potential second term and of course, Brexit.
Last week ended with a small reversal for sterling, based on disappointing news on the lack of a Brexit breakthrough. No further talks are due until 7 September. There is some suspicion that the government is relaxed about a no-deal, although the Irish premier said last week that Boris Johnson does have a “genuine desire” for a deal. Since no serious progress is likely until the politicians get together in October that will be hard to judge.
Following last week’s positive news on retail sales and consumer confidence, analysts will be looking for further signs of a V-shaped recovery, although with little data this is more likely to come from business results.
Politically, we have concerted attempts to get schools back in the UK next week, and the knock-on effect this could have in getting office workers back, where the UK lags well behind other major economies.
On Thursday, President Trump will be looking to pull a rabbit out of the hat at the Republican National Convention, to reverse his current poor poll ratings.
There is also likely to be increased interest in potential medical responses to Covid, as vaccine testing continues. We’ll be looking to see national Covid rates, as Portugal’s air bridge to the UK was restored and airlines saw an immediate boom in flights. Virgin Atlantic is looking for refinancing from creditors tomorrow, and Rolls Royce will announce potentially difficult results on Thursday.
As we approach just four months until the end of the transition period, the need to get residency in EU countries in time may begin to trump fears over quarantine and see a movement of Britons to Spain and France.
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