A Bank of England decision maker warns that the UK economy is weak – live business | Business

Hello and welcome to our slippery coverage of the global economy, financial markets, the eurozone and businesses.

It's a beautiful day in London, with many sunnier investors also settling in front of their computers.

Signs of progress regarding two illicit creatures – the US debt ceiling and the US-China trade war – are encouraging the markets.

Overnight, President Donald Trump has reached an agreement with Congress that will remove the threat of a new fiscal crisis by at least 2021. The plan paves the way for increased spending by the United States, thereby removing the danger of a closure of the government, because the national debt had weighed on the current rate. limit.

Trump said the agreement was a "real compromise". Investors will be relieved, as the risk of America defaulting on its debts (even if it can print all the dollars it needs) is avoided.

He is also defusing a potential mine as part of Trump's bid for reelection.

Adam Cole of RBC Capital Markets points out that the agreement has strengthened the US dollar.

The deal brings the debt ceiling to mid-2021 … and alleviates one of the risks weighing on US policy.

Another sign of encouraging progress, US officials are expected to return to China next week for new talks on the trade war.

The South China Post has announced that US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will meet with Deputy Prime Minister Liu He. The meeting comes as the two parties seem to unfreeze their positions.

The United States recently offered tariff exemptions to 110 Chinese products, including medical equipment and essential electronic components. China has also proposed an olive branch, allowing several companies to buy US agricultural products without paying customs duties.

This gives a boost to inventories, especially to technology companies vulnerable to trade conflict.

Asian markets rallied, Japan Nikkei winning 1% and China Composite of Shanghai up 0.5%. European markets should also increase, with the United Kingdom FTSE 100 winner 0.5% at the beginning of the session.

Also coming today

Investors are optimistic about the results of the election of conservative party leaders, probably confirming that Boris Johnson will become Britain's next prime minister.

The prospect of a non-binding Brexit will keep the pound under pressure, while Johnson's promise of higher tax cuts and spending could affect the bond market (because he will have to borrow to pay for it).

The International Monetary Fund will release its latest badessment of the global economy by forecasting how issues such as the US-China trade war and Brexit will hurt growth.

In the United Kingdom, the IWC's monthly survey of manufacturing industries should show that the confidence of British industrial firms is low.

L & # 39; s calendar

• 11:00 BST: IWC Industry Trends Report for June
• 14:00: IMF releases latest global economic outlook