Despite a lack of progress in solving the Turkish currency crisis – with investors still awaiting a much-needed, but perhaps unlikely, rate hike from the country’s central bank – and a related record low-hitting slide from the Indian rupee, the fact the lira itself avoided another sharp decline allowed the markets to get off to a decent start on Tuesday.
One of the most notable movements after the bell came from sterling. Rising 0.4%, cable kicked off the session knocking on the door of $1.28, a level it abandoned last Friday; against the euro, meanwhile, the pound added another 0.2%, lifting the currency to an 8 day, €1.12-plus peak. This in turn prevented the FTSE 100 from joining in with the rebound seen in the Eurozone, the UK index instead opening effectively flat at 7650.
Even with the ongoing lira issues it would be a busy day for the pound, with Tuesday’s jobs report the first in a hat-trick of major releases that also includes Wednesday’s CPI reading and Thursday’s retail sales figures. Wage growth remains the key feature of the jobs data; analysts are expecting the reading for June to come in unchanged at 2.5% (including bonuses), a smidge higher than the 2.4% inflation seen in the same month.
Elsewhere the Eurozone sought to claw back some of the losses incurred since last Friday. The DAX rose half a percent, propelling it towards 12450, while the CAC jumped 0.2%. Like the UK, the region has some data to distract from the situation in Turkey, with analyst forecasting the second Eurozone-wide Q2 GDP reading will remain at 0.3%.
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