Global risk appetite is seemingly enjoying a (mini) lease of life, with the Kiwi dollar at one end continuing to outperform while the safe haven Swiss Franc and Japanese yen are lagging. Sterling, propped up by decent labour market data for September, has also gained against an all-round weaker Dollar and the Euro.
UK weekly earnings rose to 3.1 year-on-year, pushing real growth into positive territory. Eurozone data in the meanwhile point to only modest economic growth in Q3 and early Q4. The German ZEW economic sentiment index in October was far weaker than expected, falling to -24.7 from -10.6 in September while the eurozone trade surplus narrowed sharply in August to EUR 11.7bn from EUR 17.6bn in July and EUR 22.5bn in June. It’s too early to tell whether the US-China trade war has had a (negative) impact on European trade but it is a trend that will have to be closely monitored.
