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Ronaldo deal getting more expensive by the moment as pound hits new highs against the euro

Christiano Ronaldo’s proposed transfer to Real Madrid was announced on the day the pound hit its highest level against the euro for six months - and until the paperwork is signed and sealed every rise will costing the Spanish club more money.

The pound hit 1.17 euros on Thursday, up from lows of 1.07 in January, and currency experts have calculated that each cent the euro falls will cost the Spaniards an extra one million euros.

The £80million price the two clubs have agreed would have cost Real Madrid €83 million in January when the pound was much weaker, but at today’s exchange rate the same sterling amount will cost Real Madrid €93 million.

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Risk Aversion trading takes over again in the Far East as uncertainty over the seriousness of the ‘swine-flu’ proves the driver for market traders. Official comment puts the death toll so far in Mexico at 103 and although there have been no fatalities from the disease in the US, there have been reported cases in several large cities including at a high school in New York City. This really is an example of ‘watch this space’ and the market will be conscious of any adverse developments. Read the rest of this entry »

The Market gives Alistair Darling the benefit of some considerable doubt, for now anyway. The numbers that we would prefer to see small and positive are horrendously large and negative whilst the future growth projections seems overly optimistic - especially compared to the expectations published by the IMF this week. To expand further, The Chancellor sees 2009 growth at between -3.25% and -3.75% and Public Sector Net Borrowing for the year at 12.8% of GDP which in number terms is around £175 billion. To fund this, the DMO have scheduled the issuance of £220 billion in gilts for the period 2009/10 up from £146.4 billion in 2008/09. Read the rest of this entry »

Yesterday saw some interesting data out from the UK and Europe and a series of official interest rate reductions from around the globe.

Taking the latter first, we got a 0.25 cut from the Reserve Bank of India down to 4.75%, a 0.50 reduction from the Riksbank in Sweden to 0.50% and a 0.25 basis point cut by the Bank of Canada down to 0.25%. Of these 3 Central Banks, the Canadians were by far the most dovish in its accompanying statement, saying that unless there is an unexpected move up in inflation, they expect their interest rates to stay at these lowly levels for at least the next 12-months. They also announced that they will be the latest CB to go down the QE route following an announcement of a framework of measures on Thursday. Read the rest of this entry »

On the face of it yesterday’s Bank of America’s Q1 figures were excellent continuing the recent strong rebound in US Banks’ performances with the organisation reporting a better-than-expected $4.2bn in Q1 earnings, which reflected strong results at recently acquired Merrill Lynch. Read the rest of this entry »

With a vast diversity in indicators leading to widely different opinions and prognostications as to the likely outcome for the current global economic down-turn. No one can be wrong - just yet - and no one will remember all the predictions that turn out to be wide of the mark. It is therefore no surprise that we see predictions for both a V shaped recovery but also for the recession to be maintained, bumping along as an L shape. Read the rest of this entry »