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Pound steadies as markets await key US jobs report - business live Pound steadies as markets await key US jobs report - business live
(35 minutes later)
11.24am BST
11:24
European markets are looking a little mixed now ahead of those US payroll numbers at 1.30pm (UK time).
The FTSE 100 is slightly down, while the FTSE 250 is up 1.2% at 16,092.
Michael Hewson at CMC Markets says investors are hanging on to see what the jobs report brings
There appears to be little incentive this morning to drive markets strongly one way or the other ahead of this afternoon’s US payrolls report.
We do have a slightly firmer tone with the FTSE100 underperforming somewhat due to a weaker oil price, but overall we appear to be in a holding pattern at the end of what has been a fairly turbulent week.
10.55am BST
10:55
More on the the risk of political contagion posed by the Brexit vote.
Any signs of political contagion could trigger a “wild” reaction among investors according to NN Investments.
There is no guarantee that investors’ emotions will not turn wild again if signs of political contagion from the UK into mainland Europe becomes more visible, or if the needed recapitalisation of the Italian banking system remains unresolved, or if headline-grabbing newsflow of suspensions of real estate funds intensifies.
10.36am BST10.36am BST
10:3610:36
Get news alerts on the US jobs reportGet news alerts on the US jobs report
The Guardian Mobile Innovation Lab will be publishing news alerts on today’s US jobs report.The Guardian Mobile Innovation Lab will be publishing news alerts on today’s US jobs report.
From 1.30pm BST/8.30 am EST,they’ll be sending a series of alerts about the report’s numbers and what they mean. Web notifications are currently only available on Chrome, so if you have an Android mobile phone (Samsung, included!), we hope you’ll sign up.From 1.30pm BST/8.30 am EST,they’ll be sending a series of alerts about the report’s numbers and what they mean. Web notifications are currently only available on Chrome, so if you have an Android mobile phone (Samsung, included!), we hope you’ll sign up.
Click here to sign up for the experiment.Click here to sign up for the experiment.
10.34am BST10.34am BST
10:3410:34
Moody's: Political contagion across EU is greatest Brexit riskMoody's: Political contagion across EU is greatest Brexit risk
Some gloomy observations this morning from Moody’s, which is warning that Brexit could topple the whole EU project.Some gloomy observations this morning from Moody’s, which is warning that Brexit could topple the whole EU project.
The ratings agency says that a weaker UK and EU economy in the wake of the Brexit vote is not the key risk to the global economy. Rather it is political contagion.The ratings agency says that a weaker UK and EU economy in the wake of the Brexit vote is not the key risk to the global economy. Rather it is political contagion.
The downside risks to global growth stem not from the possibility of a recession in the UK, but from the possibility that developments in the UK may give rise to increased political risk elsewhere in the EU.The downside risks to global growth stem not from the possibility of a recession in the UK, but from the possibility that developments in the UK may give rise to increased political risk elsewhere in the EU.
In the long run, the potential strengthening of nationalistic and protectionist movements could have a detrimental effect on the EU, even threatening its existence.In the long run, the potential strengthening of nationalistic and protectionist movements could have a detrimental effect on the EU, even threatening its existence.
The fragmentation of the trade bloc could also encourage protectionist tendencies in other countries, potentially halting the past few decades of increasing globalisation. This in turn would damage the long-term growth prospects of individual economies.The fragmentation of the trade bloc could also encourage protectionist tendencies in other countries, potentially halting the past few decades of increasing globalisation. This in turn would damage the long-term growth prospects of individual economies.
The EU economy represents roughly a quarter of global GDP, making it systemically important to the world economy and the US. Therefore, if the negative risks in the EU materialize, it would have a significant consequences for global trade and growth.The EU economy represents roughly a quarter of global GDP, making it systemically important to the world economy and the US. Therefore, if the negative risks in the EU materialize, it would have a significant consequences for global trade and growth.
UpdatedUpdated
at 10.35am BSTat 10.35am BST
10.14am BST10.14am BST
10:1410:14
Paul Hollingsworth, UK economist at Capital Economics, is underwhelmed by the UK trade performance, describing it as “disappointing”.Paul Hollingsworth, UK economist at Capital Economics, is underwhelmed by the UK trade performance, describing it as “disappointing”.
He makes the point that very little progress is being made towards rebalancing the economy - a long-held ambition of George Osborne - away from domestic consumer spending and towards exports.He makes the point that very little progress is being made towards rebalancing the economy - a long-held ambition of George Osborne - away from domestic consumer spending and towards exports.
May’s UK trade figures are a further sign of the unbalanced nature of the economic recovery.May’s UK trade figures are a further sign of the unbalanced nature of the economic recovery.
Looking ahead, the 10% or so fall in trade-weighted sterling since the referendum should help to boost exports in time.Looking ahead, the 10% or so fall in trade-weighted sterling since the referendum should help to boost exports in time.
Although any improvement is likely to be slow against a background of fairly sluggish global growth and uncertainty about future trade relationships between the UK and other countries.Although any improvement is likely to be slow against a background of fairly sluggish global growth and uncertainty about future trade relationships between the UK and other countries.
10.03am BST10.03am BST
10:0310:03
The reason behind the rise in the UK’s goods deficit is that exports fell more sharply than imports in May.The reason behind the rise in the UK’s goods deficit is that exports fell more sharply than imports in May.
£9.9bn goods #trade deficit in May, £0.5bn wider than April, again with exports down more than imports https://t.co/KW9BJYGqiz£9.9bn goods #trade deficit in May, £0.5bn wider than April, again with exports down more than imports https://t.co/KW9BJYGqiz
Exports fell by £2.1bn to £23.7bn in May, while imports fell by 1.6bn to £33.5bn according to theExports fell by £2.1bn to £23.7bn in May, while imports fell by 1.6bn to £33.5bn according to the
Over a three-month period however, the trade deficit narrowed by £2.5bn to £8.2bn.Over a three-month period however, the trade deficit narrowed by £2.5bn to £8.2bn.
Britain’s trade position with the EU improved slightly over the three months, narrowing by £100m to £22.5bn as exports increased by more than imports.Britain’s trade position with the EU improved slightly over the three months, narrowing by £100m to £22.5bn as exports increased by more than imports.
Outside the EU, things also looked better, with a 6.8% increase in exports pushing the deficit down £2.6bn to £8.2bn.Outside the EU, things also looked better, with a 6.8% increase in exports pushing the deficit down £2.6bn to £8.2bn.
The hope is that the weaker pound will drive exports higher because British-made goods will be cheaper abroad.The hope is that the weaker pound will drive exports higher because British-made goods will be cheaper abroad.
But on the flip side, it makes imports more expensive, which could lead to a rise in prices in UK shops.But on the flip side, it makes imports more expensive, which could lead to a rise in prices in UK shops.
9.33am BST9.33am BST
09:3309:33
Breaking: UK trade deficit widens in MayBreaking: UK trade deficit widens in May
The UK trade in goods deficit widened slightly in May, to £9.9bn from £9.4bn in April.The UK trade in goods deficit widened slightly in May, to £9.9bn from £9.4bn in April.
The figure for April was a downward revision from an earlier estimate of a £10.5bn goods deficit.The figure for April was a downward revision from an earlier estimate of a £10.5bn goods deficit.
9.29am BST9.29am BST
09:2909:29
Connor Campbell, analyst at Spreadex, has a take on the markets this morning:Connor Campbell, analyst at Spreadex, has a take on the markets this morning:
It was a fairly typical start to a non-farm Friday for the European indices, which have little to occupy themselves with until this afternoon’s US data dump.It was a fairly typical start to a non-farm Friday for the European indices, which have little to occupy themselves with until this afternoon’s US data dump.
At most rising by 10 points the FTSE continued to hover around the 6550 mark this morning, that level having become the UK index’s safe space for much of the week.At most rising by 10 points the FTSE continued to hover around the 6550 mark this morning, that level having become the UK index’s safe space for much of the week.
The pound was similarly settled (it’s all relative) at the start of Friday, trading just above $1.29 against dollar and €1.165 against the euro.The pound was similarly settled (it’s all relative) at the start of Friday, trading just above $1.29 against dollar and €1.165 against the euro.
9.22am BST9.22am BST
09:2209:22
UK trade data is coming up. The goods deficit with the rest of the world is expected to widen slightly to £10.65bn in May from £10.52bn in April.UK trade data is coming up. The goods deficit with the rest of the world is expected to widen slightly to £10.65bn in May from £10.52bn in April.
The figures should be out at 9.30.The figures should be out at 9.30.
9.10am BST9.10am BST
09:1009:10
German exports take a dive in MayGerman exports take a dive in May
German exports fell at the sharpest rate in nine months in May.German exports fell at the sharpest rate in nine months in May.
It was an unexpected drop, and a weaker than expected rise in exports was another sign that demand is slowing in Europe’s largest economy.It was an unexpected drop, and a weaker than expected rise in exports was another sign that demand is slowing in Europe’s largest economy.
Exports fell by 1.8% over the month, following a 0.1% rise in April. Imports increased by 0.1%, so Germany’s trade balance narrowed to €22.1bn from €24.1bn in April.Exports fell by 1.8% over the month, following a 0.1% rise in April. Imports increased by 0.1%, so Germany’s trade balance narrowed to €22.1bn from €24.1bn in April.
Carsten Brzeski, economist at ING, says it tops off a bad week for Germany, both in economic and footballing terms...Carsten Brzeski, economist at ING, says it tops off a bad week for Germany, both in economic and footballing terms...
Another indicator signalling that Germany’s performance is currently not champion-like.Another indicator signalling that Germany’s performance is currently not champion-like.
Today’s trade data mark the end of a disappointing week for the German industry. All May data point to a sharp slowdown of the German industry.Today’s trade data mark the end of a disappointing week for the German industry. All May data point to a sharp slowdown of the German industry.
Probably the entire batch of industrial data will not get the attention it deserves. Germany will be mainly busy digesting and analysing its own exit; the exit from the Euro2016, the European Soccer Championships.Probably the entire batch of industrial data will not get the attention it deserves. Germany will be mainly busy digesting and analysing its own exit; the exit from the Euro2016, the European Soccer Championships.
However, to offer some solace: if there is any economic impact from soccer, last night’s result was the best possible outcome for the eurozone: stimulus and psychological support for France, while at the same time Germany can still feel superior.However, to offer some solace: if there is any economic impact from soccer, last night’s result was the best possible outcome for the eurozone: stimulus and psychological support for France, while at the same time Germany can still feel superior.
UpdatedUpdated
at 9.12am BSTat 9.12am BST
8.39am BST8.39am BST
08:3908:39
Markets are steady this morning, with no big lurches in the pound or equities.Markets are steady this morning, with no big lurches in the pound or equities.
But European shares are on track for their worst week in five months. Following a rebound in the week immediately after the Brexit vote, investors appear to have taken a step back this week.But European shares are on track for their worst week in five months. Following a rebound in the week immediately after the Brexit vote, investors appear to have taken a step back this week.
Michael Hewson, chief market analyst at CMC Markets UK, says that some harsh realities have been sinking in:Michael Hewson, chief market analyst at CMC Markets UK, says that some harsh realities have been sinking in:
It’s been a strange week for equity markets with heavy falls for European markets reversing a lot of the gains that we saw in the week post Brexit, though US markets and the FTSE100 have stood out as outperforming, and managing to hang on to a good proportion of their gains thus far this week.It’s been a strange week for equity markets with heavy falls for European markets reversing a lot of the gains that we saw in the week post Brexit, though US markets and the FTSE100 have stood out as outperforming, and managing to hang on to a good proportion of their gains thus far this week.
Having got caught up in the euphoria of the prospect of lower for a lot longer interest rates, investors forgot about the vulnerability of the European banking system and its sclerotic banks and soon saw the error of their ways, smashing the Italian banking sector, as well as Swiss giants UBS and Credit Suisse and German giant Deutsche Bank to new record all-time lows.Having got caught up in the euphoria of the prospect of lower for a lot longer interest rates, investors forgot about the vulnerability of the European banking system and its sclerotic banks and soon saw the error of their ways, smashing the Italian banking sector, as well as Swiss giants UBS and Credit Suisse and German giant Deutsche Bank to new record all-time lows.
8.22am BST8.22am BST
08:2208:22
European markets open roughly flatEuropean markets open roughly flat
Markets are not exactly off to a flying start this morning, as investors await the main event of the day from the US at 1.30pm (UK time), when the June payrolls report will be published.Markets are not exactly off to a flying start this morning, as investors await the main event of the day from the US at 1.30pm (UK time), when the June payrolls report will be published.
The FTSE 100 is up 8 points.The FTSE 100 is up 8 points.
8.10am BST8.10am BST
08:1008:10
UK consumer confidence plungesUK consumer confidence plunges
A report published overnight shows consumer sentiment has taken a hammering in the aftermath of the Brexit vote.A report published overnight shows consumer sentiment has taken a hammering in the aftermath of the Brexit vote.
GfK’s long-running index of consumer confidence dropped eight points to -9 in a special report to measure sentiment after the vote.GfK’s long-running index of consumer confidence dropped eight points to -9 in a special report to measure sentiment after the vote.
It was the sharpest drop in 21 years. A breakdown of responses showed that people who voted to remain in the EU were feeling the least confident, at -13, while leavers were less pessimistic at -5.It was the sharpest drop in 21 years. A breakdown of responses showed that people who voted to remain in the EU were feeling the least confident, at -13, while leavers were less pessimistic at -5.
GfK noted a fall across all the survey’s key indicators, including the outlook for household finances and people’s appetite for splashing out on major purchases.GfK noted a fall across all the survey’s key indicators, including the outlook for household finances and people’s appetite for splashing out on major purchases.
Joe Staton, head of market dynamics at GfK:Joe Staton, head of market dynamics at GfK:
In these extraordinary times this one-off Brexit special gauges the temperature of consumer confidence right now.In these extraordinary times this one-off Brexit special gauges the temperature of consumer confidence right now.
During this period of uncertainty, we’ve seen a very significant drop in confidence, as is clear from the fact that every one of our key measures has fallen, with the biggest decrease occurring in the outlook for the general economic situation in the next 12 months.During this period of uncertainty, we’ve seen a very significant drop in confidence, as is clear from the fact that every one of our key measures has fallen, with the biggest decrease occurring in the outlook for the general economic situation in the next 12 months.
Read our full story on the report here:Read our full story on the report here:
Related: Brexit vote batters consumer confidenceRelated: Brexit vote batters consumer confidence
7.50am BST7.50am BST
07:5007:50
The agenda: US payrolls and UK tradeThe agenda: US payrolls and UK trade
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
The main focus of the day is the US payrolls report for June.The main focus of the day is the US payrolls report for June.
The report has particular significance this month following an absolute shocker last month, when it emerged the number of jobs added in May was just 38,000. Economists were expecting a 164,000 increase in jobs...The report has particular significance this month following an absolute shocker last month, when it emerged the number of jobs added in May was just 38,000. Economists were expecting a 164,000 increase in jobs...
It was the weakest growth in jobs since September 2010, and the numbers for March and April were also revised down.It was the weakest growth in jobs since September 2010, and the numbers for March and April were also revised down.
Related: US economy adds paltry 38,000 jobs in May for weakest growth since 2010Related: US economy adds paltry 38,000 jobs in May for weakest growth since 2010
Investors will be looking for improvement in today’s numbers, and hoping the sharp slowdown in May was just a blip. Economists polled by Reuters are forecasting a 175,000 increase in payrolls in June.Investors will be looking for improvement in today’s numbers, and hoping the sharp slowdown in May was just a blip. Economists polled by Reuters are forecasting a 175,000 increase in payrolls in June.
If the number comes in strong, the expectation will be that the Federal Reserve will raise rates sooner rather than later, possibly in September.If the number comes in strong, the expectation will be that the Federal Reserve will raise rates sooner rather than later, possibly in September.
Another shockingly weak number would raise concerns that a worrying trend is emerging in the US labour market, putting a rate rise off the table for the time being.Another shockingly weak number would raise concerns that a worrying trend is emerging in the US labour market, putting a rate rise off the table for the time being.
The Fed is, of course, weighing up other factors, not least what impact Britain’s decision to leave the EU will have on the US economy.The Fed is, of course, weighing up other factors, not least what impact Britain’s decision to leave the EU will have on the US economy.
Meanwhile the pound is settled at the moment, hovering around $1.29 and currently at $1.2934.Meanwhile the pound is settled at the moment, hovering around $1.29 and currently at $1.2934.
Also coming up today we have UK trade data for May. Although it covers the period before the referendum on 23 June, it will serve as a timely reminder of Britain’s current trade position with the rest of the world.Also coming up today we have UK trade data for May. Although it covers the period before the referendum on 23 June, it will serve as a timely reminder of Britain’s current trade position with the rest of the world.
The IMF will publish its latest take on the eurozone at 2pm UK time.The IMF will publish its latest take on the eurozone at 2pm UK time.
We will bring you all the latest developments as they happen.We will bring you all the latest developments as they happen.