This morning the annual inflation rate in the UK dropped to 7.9% in June from 8.3% in May. This is the lowest level since March 2022 and slightly below expectations of 8.2%. The pound promptly lost 0.5% against the euro and is currently 1.7% lower than this time last week.
Food inflation in the UK fell for the fourth consecutive month in July, according to Kantar. Research found the annual pace of grocery price inflation eased to 14.9%, down from 16.5% in June.
At the current levels of inflation, UK households would have to spend an additional £683 more on groceries annually to buy the same items they did a year previously.
On the currency markets, there was little movement yesterday due to a lack of market-moving data, but this morning’s UK inflation reading prompted the pound to fall against the US dollar. The current rate is 1% lower than this time yesterday.
Speaking of inflation, the annual inflation rate in Canada fell to 2.8% in June, the lowest rate seen since March 2021. This comes following 3.4% in June and suggests the Bank of Canada is doing a good job at bringing inflation down.
After Thames Water’s damning report revealed performance has not improved in the past year, the utility service’s biggest investor slashed the value of its stake by 28%. The investor in question is Canadian public sector fund Omers which owns almost a third of the highly indebted utility.
On the stock market, Wall Street big league the Dow Jones surged 400 points and the S&P 500 gained close to 0.4%, both soaring to levels not seen since April 2022.
This came following a mixed market report from US banks. Morgan Stanley saw its earnings and revenue beat forecasts, while profits declined 0.5% during the second quarter of 2023. Meanwhile, the Bank of America gained 2.5%, and Charles Schwab jumped more than 11%.
Later this afternoon, US building permit figures are expected to decline from 1.1496 million in May to 1.1462 in June, meaning fewer permits were granted across the country for new and existing building works.
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