Garton Global | Weekly Market Digest
Markets stayed cautious last week as weak UK growth data and renewed tariff threats kept nerves tight. Sterling slipped on the GDP miss, while Trump’s fresh tariff warnings rattled global sentiment. Fed minutes showed little urgency to cut, even as tensions with the White House flared.
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Last Week
🇬🇧 UK GDP Miss Keeps Pressure on Sterling
● The UK economy shrank 0.1% in May, the second monthly contraction and a miss versus expectations.
● Gilt yields rose midweek on debt concerns, but Friday’s weak data renewed pressure on the pound.
● With growth stalling and tax hikes expected, Sterling remains fragile despite signs of short-term support.
🇺🇸 Trump’s Tariff Blitz Rattles Markets
● Trump revived tariff threats, sending letters and warning of levies up to 50% by August 1.
● Major partners like Canada, Brazil, Japan, and the EU remain exposed, adding to trade anxiety.
● The dollar bounced midweek but lacked follow-through, as policy chaos continues to cap sentiment.
🇺🇸 Fed Minutes Expose Tensions with the White House
● Minutes showed most Fed officials see no urgency to cut, citing risks from Trump’s trade agenda.
● Trump lashed out at Powell, escalating political pressure on the Fed ahead of key decisions.
● Markets are watching closely — Powell holds firm, but Fed independence looks increasingly under strain.
This Week
🇺🇸 US Inflation in Focus as Tariff Fears Support the Dollar
● June CPI lands Thursday, with risks tilted to the downside after softer services price data and mixed ISM signals.
● Cooling inflation could revive talk of a July Fed cut, but strong jobs data has already narrowed that window.
● Dollar remains bid for now, supported by safe-haven demand and fading rate cut expectations.
🇬🇧 UK Inflation and Jobs Data Could Cement August BoE Cut
● CPI and labour market figures due midweek, with signs of slack already prompting a dovish BoE tone.
● Markets see a 77% chance of an August cut — softer inflation or jobs data could seal it.
Key Events
Tuesday July 15th
13:30 US & Canadian CPI
21:00 UK Gov Bailey Speaks
Wednesday July 16th
07:00 UK CPI
13:30 US PPI
Thursday July 17th
02:30 Australian Unemployment Rate
13:30 US retail sales & Unemployment Claims
Have a great week,
The Garton Team.
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