Leading Indicators | Political shifts, dollar strength, and stabilising swap rates

Written By:
Khadija Hussain, Knight Frank
1 minute to read

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Here we look at the leading indicators in the world of economics.

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Stabilisation in swap rates 

The UK 5-year SONIA swap rate is currently 4.06%, down -13bps a month ago and -109bps one year ago. Euro and US swap rates have also declined. In contrast, Japanese swaps remain elevated compared to a year ago.

Multiple international currencies have weakened against the dollar

Over the past year, significant interest-rate divergences among economies have influenced several currencies. YTD, multiple international currencies have weakened against the greenback, including the Japanese Yen (-12.7%), the Euro (-2.8%) and the Pound Sterling (-0.6%).

Global geopolitical risk falls -4% m/m 

2024, better known as the election year, will see more than 50 countries heading to the polls, with the UK and France general election kicking off this week. Meanwhile, the Geopolitical Risk Index (GPR), a gauge that will be closely monitored amidst changes to the political spectrum, fell -4% m/m in May, albeit remains relatively elevated. 

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