Eurozone June Sentix investor confidence 28.1 vs 25.4 expected

Latest data released by Sentix – 7 June 2021

  • Prior 21.0
That’s a decent beat and reaffirms more optimistic sentiment towards the euro area economy as of late, with vaccinations picking up and the virus situation getting better.


This isn’t going to move the needle in the euro for now but it does reflect better prospects going into the summer, though we’ll see what the ECB has to offer later this week.

Eurostoxx futures -0.1% in early European trading

Tepid and flattish tones in early trades

  • German DAX futures -0.1%
  • UK FTSE futures flat
  • Spanish IBEX futures -0.1%
This mirrors the mood in US futures, which are seen down ~0.2% at the moment, following the gains posted on Friday after the more Goldilocks jobs report.
There isn’t much of a firm directional move to start the new week with FX also keeping rather muted besides some mild weakness in the pound. GBP/USD is down 30 pips to 1.4125 but it isn’t anything outside the range of the past three weeks.

Do you read central bank statements?

Don’t just read the bullet points

Don't just read the bullet points

One of the most underrated, but most valuable pieces of research you can do is to actually read central bank statements. Now I know the temptation. Go with the bullet points. You come to your desk and you see the latest central bank minutes with a few lines of analysis. Job done. Not so fast speedy gonzalez! By not reading over the central bank statement you are missing out on some significant benefits.

If you are are a new trader the fastest way to zoom in on the global outlook is to read central bank statements. Central banks are acutely aware of global financial activity. They will often give you a potted summary of what is going on around the globe. The major concerns, worries, etc etc. Central banks want to maintain stable monetary policy for their nations, so they have to be well up on the global picture.

You can also see an emphasis the bullet points miss. Sometimes the bullet point summary will miss an important point buried within the statement. It can be a point that wasn’t relevant at the time the bullet points were made, but can become relevant at a later date. If you have read the whole of the statement you are better placed to pick that up.

Another important point is that you can read the context. One of my key teaching points from the benefit of a theology background and teaching people how to understand a biblical text is to realise that a text out of context is a con. Bullet points don’t show the context. Take this example – ‘Giles is the best analyst I have ever read’. Sounds amazing right? So, I am about to send it out on twitter, but you stop me and say Giles, look at the context.
We look more closely and this is what we read in context

Giles is the best analyst I have ever read. Of course, he is the only analyst I have ever read!

So, you get the point. The bullet points will often misconstrue the context. These slight shifts add up. In some cases they can nullify the meaning .Finally, by reading the whole of the statement the information goes into your subconscious and this will help your ‘gut feel’. The part of you that you access subconsciously that is essentially an edge over time once it is developed,

Moody’s says China seeing a strong rebound, but risks are rising

Moody’s rating agency onf China, in summary:

  • Strong rebound has become broad-based and recovery will continue throughout 2021 given supportive domestic policies and robust external demand
  • China’s financial market opening, capital flows and the external environment present risks to the growth outlook over the next 12 months
There is more at the Moody’s piece on their latest China report, a handy summary.

More on Australia’s outlook upgrade from S&P

In brief:
  • S&P Global Ratings upgraded its outlook on Australia’s “AAA” sovereign rating to ‘stable’ from ‘negative’
  • says the economy has rebounded sharply to above pre-pandemic levels
  • thanks to the country’s successful handling of the coronavirus pandemic, massive fiscal and monetary stimulus
  • S&P more confident now that the government’s fiscal deficit will narrow toward 3% of gross domestic product during the next 2-3 years after reaching a 10% deficit in the year-ending June 2021
Rising commodity prices for Australia’s exports played a role also.

ICYMI – Twitter’s Dorsey says Square is considering creating a non-custodial hardware wallet for bitcoin

Dorsey is also Square’s chief executive officer, he spoke on Friday (hence the ICYMI):

  • “We don’t want to compete with other hardware wallets out there” 
  • “We just want to take it to the next level and get to 100 more million people, which have non-custodial solutions”
Dorsey indicated it’d be open source:
  • “If we do it, we would build it entirely in the open, from software to hardware design, and in collaboration with the community”
Bitcoin wallets can be stored offline or online at cryptocurrency exchanges,
  • a non-custodial wallet, you have sole control of your private keys, which in turn control your cryptocurrency and prove the funds are yours
  • With a custodial wallet, another party controls your private keys
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