Veteran popista Cliff Richard has decided at the age of 70 that the time has come to “do” Las Vegas. His Stateside tour will include recording a new album with other artists, one of whom could well be a rapper. If Cliff is lucky enough to team up with 50 Cent he could cover “Were I to be your favourite chum” while 50 does “We’re all goin’ on a ******’ vacation”. They would probably both make a few bob from the exercise, if only for the novelty value, though perhaps not as much as the £6.5 million Barclays’ Bob made last year. Mr Diamond must be miffed that he gets a bad press for earning, as head of a top-100 global corporation, less than at least a dozen football players.
Also getting a bad press yesterday was the 20 Bob*. It started off well enough, with Cable rising in the morning to the high it clocked last week. Having achieved that level investors backed off, encountering a considerable supply from sellers keen to offload pounds at a 13-month high. They beat a hasty retreat and Cable was nearly a cent and a half lower by the end of the London session.
Sterling gave up the ghost even earlier in the day in its contest with the euro. After less than an hour and well under half a cent the pound went into reverse, only consolidating when it was down to the lows of late January. Investors were prepared to overlook the downgrade of Greek government debt by Moody’s (now there’s a pointless gesture if ever there was one) and to concentrate instead on the “promise” of a euro interest rate increase next month. Sterling was bound to come second in that argument because of investors’ near-certainty that the Bank of England will make no policy change this week and their doubts that any move will come in April.
A dribble of data included a fractional improvement in the Sentix index of Euroland investor confidence; it went up from 16.7 to 17.1. The news elicited no reaction, as did an unexpected -5.1% fall in the number of Canadian building permits issued in January. There was no reaction either to weak sales figures from the British Retail Consortium or a five-point improvement, to -26, in the RICS house price balance. Both came out at midnight, so it is possible the London market will not treat the figures with the same disregard as that shown in the Far East.
And nobody really cared that Australian business confidence jumped by 10 points to 14 in February, or that Japan registered a trade deficit in January, or that New Zealand’s QV house price index was down by -1.7% in the year to February, or that Swiss unemployment fell from 3.8% to 3.6%. None of those had anything to do with a bull run by the New Zealand dollar this morning. It rallied by more than a cent, apparently as the result of technical targets having been met and a feeling that the previous selling might have been overdone. And none of them was responsible for another day of underperformance by the Swiss franc. The excuse this time was the rumour that Col. Gadaffi was looking for a peaceful way out of his predicament.
From a statistical point of view today will be no more rewarding than Monday; French business sentiment, German factory orders, Canadian housing starts and that’s the lot until tonight brings Australian consumer confidence and home loans and Japanese machine orders.
Looking to the future, those with a need to buy US dollars should look at the way sterling has topped out at roughly the same level two weeks running. Investors still claim to loathe the dollar and they continue to build short positions, according to the Chicago futures exchange. But with Euroland’s PIGS rattling their cages and Cable running into resistance it is not impossible to imagine some of those investors taking a bit of profit. The turnaround is not assured (not in any predictable timeframe anyway) but if it happens it could be rapid.
* Historical note: “Bob” was the nickname for an old British coin worth 48 farthings or half a florin. Its official name was the “shilling”, now known more prosaically as “5p”.