The Monday note - 13 August 2018

• The FTSE 100 closed on Friday at 7,667.0, which was little changed on a week earlier, as a robust UK GDP figure was counter balanced by concerns about the global economy. The ten year Gilt yield stood at 1.25%. 
• The Turkish lira fell sharply after President Trump imposed higher tariff’s on the country’s steel and aluminium exports to the US. This has added to a general flight from many emerging markets currencies by investors this year. 
• The UK Chancellor, Philip Hammond, said in a media interview that he might consider a tax on revenue for online retailers to “rebalance the playing field” for high street stores. 
• UK GDP grew by 0.4% in Q2 2018, which was double the figure recorded in Q1. Solid growth for services and a rebound for construction more than offset a contraction for manufacturing. 

Chief Economist comments: 

Now we know why the Bank of England had the confidence to raise rates, as the UK has recorded higher GDP growth than the Eurozone in Q2.

Moreover, the economic think tank, NIESR, are predicting growth to gather pace in Q3. Britain’s economy is finding its stride at a time when global investors are seeking safe havens.

Were the Brexit uncertainty to end a lot of overseas money might flow in – but first we need the politicians to get a sensible deal with the EU on the table.