• US equity markets traded firmer overnight whilst Asian markets, for the most part, trade lower this morning
• Fed rate hike and FOMC meeting later today seems priced in
• US tariffs on Chinese goods reiterated by Washington
• Bitcoin falls to a 2 and a half month low on regulatory concerns 
• PwC facing a £10m fine over their poor BHS audit
• Tesla cuts 9% of staff with a refocused goal of profitability

UK, US and Europe: A mixed affair in Asia saw gains in Japan overshadowed by losses across China, Hong Kong, and Australia. The boost provided by yesterday’s Trump-Kim summit seems to have been short-lived, with markets now turning their attention to the central banks and the continued trade tariff chat. First up it is the Fed, with the ECB and BoJ following in the final two days of the week. The dollar has continued to firm ahead of this evenings FOMC meeting and rates announcement and in turn, commodity prices continue to find short term pressure. Trade friction conitunes between American and China after Washington stated it is planning to release a list of $50bn worth of Chinese imports subject to a 25% tariff.

In Europe there is likely to be a significant degree of interest around the UK CPI figure, with headline inflation expected to remain steady despite the wider trend of falling CPI over the first six-months of the year. Also keep an eye out for the employment change and industrial production figures from the eurozone. In the US, crude inventories gives way to the latest Fed rate decision, where Powell is expected to preside over yet another hike. Crucially, we also see a batch of economic forecasts to accompany that decision, with markets largely looking towards the dot plot to see if there is any shift towards expecting 4 instead of 3 hikes in 2018.

South Africa: The rand has weakened significantly as a result of a strengthening dollar. While our local bourse is expected to trade more or less flat leading into the US data tonight, locally listed banking and retail counters are expected to see early pressure on the back of the currency move. BHP Billiton is trading 1.3% lower this morning suggestive of a softer start for diversified resource counters. Tencent is trading more or less flat on the Hang Seng suggestive of a similar start for locally listed Naspers. 

Economic Calendar (times in BST)

Source: Daily FX Economic Calendar

Corporate News
Mulberry posted a fall in annual profit and said conditions had worsened in the early part of the new financial year. Pre-tax profit fell 8% to £7.5m, but revenue rose 1% to £169.7m. 

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