Today's financial news

Thursday 10th August

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European gas prices signal a far from ending energy crisis, whilst a US ban on China's high-tech sector comes into play

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US inflation cools down

Official US inflation figures are expected to have remained steady at 3% in July, with analysts suggesting that the anticipated figures will cause the Fed to hold interest rates in September. The consumer price index (CPI) is forecast to have increased 0.2% from June to July, according to economists surveyed by Refinitiv. This suggests a cooling down of the world’s largest economy, and ultimately reducing inflation pressures. Official figures will be released at 8:30am eastern time on Thursday.

European gas rises 40%

European natural gas prices surged almost 40% on Wednesday as expectations of a supply disruption, caused from Australian LNG plant strike action, looms. In turn, the prices on the Title Transfer Facility (TTF), the European benchmark, rose to more than €43 per megawatt hour, up from almost €30 on Tuesday. This marks the highest point European oil prices have reached since June. As you can imagine, this has led traders to tread with caution as they anticipate further declines. As LNG plant workers demand better pay and working conditions, this is a clear indication that the almost two-year energy crisis is far from over as concerns over natural gas supply looms heavy over the continent. 

US bans China’s high-tech sector

President Joe Biden signed an executive order on Wednesday, issuing that American investment in some areas of China's high-tech sector will be banned. As an attempt to strengthen the US’s ability to screen foreign dealings with private companies, the move will impact sectors such as artificial intelligence, microelectronics and semiconductors. Unsurprisingly, it will also further strain already tainted relations between the two superpowers. US firms will also be asked to disclose what investments they make in Chinese high-tech sectors in an attempt to keep a close eye on high-tech investments. 

Sources: Financial Times, Guardian

Maria Collinge