Daily Market Commentary 2nd June 2022

European and US equities continued to lose ground overnight, with softer Manufacturing data from Europe and the USA. The impact of inflation remains front and centre of the economic narrative, with the Bank of Canada raising interest rates by a further 50 basis points and indicating there will be more to come. This follows the EU inflation surge to 8.1%, the red lights are flashing brightly, but the ECB has done nothing other than indicate an intention to act. They have really missed the boat, along with the self-destructive sanctions (courtesy of their political leaders) they have landed their collective selves into a complete economic disaster.

US Bond Yields are on the rise and boosting the US Dollar, with the EUR falling to 1.0650, while the Yen crashed to 130.15. Leading US Banker, Jamie Dimon (JP Morgan CEO) warned the US economy was heading for a ‘hurricane’. Australian GDP was lower at 3.3%, but much better than expected, providing some solace for the currency. The rising reserve hit the NZD, which fell back to 0.6470, while the AUD traded just below 0.7200.

Inflation and growth remain key indicators to market direction.