Article / 29 July 2016 at 9:30 GMT

Daily Shot: UK versus EU, post-Brexit Team / Saxo Bank
  • Uncertainty dominates UK economic sentiment after Brexit referendum
  • House prices in the UK are still growing strongly
  • In the Eurozone business and consumer sentiment beats expectations despite Brexit
  • Spanish unemployment is better than expected and down to 20% -  lowest since 2011
  • Italian 5-yr government bond auction result in lowest (auction) yield on record 
By Walter Kurtz*

A bit more then a month has passed since the Brexit referendum. Let's start with looking at the UK.

1. UK 10yr gilts yield hit new lows
UK yields
2. According to Moody's, UK banks are looking at a £68bn capital shortfall after Brexit. 
3. Economic headlines out of the UK continue to indicate elevated uncertainty.
UK economic headlines
4. UK house price appreciation beat consensus - with home prices still growing above 5% per year.

5. The GBP implied volatility index hit new lows not seen since May.  
GBP volatility
1. In the Eurozone, the economy seems to be resilient to Brexit (so far), as business and consumer sentiment beats expectations. 
2. Germany seems to be gradually pulling out of the disinflationary mode. Is this sustainable? Market-based inflation expectations remain depressed. 
3. Italian 5-year government bond auction sold new bonds at the lowest (auction) yield on record (26bp).
Italian gov bonds
4. Spanish unemployment rate falls to 20% - amazingly that's the lowest level since 2011. 
Spanish unemployment
Elsewhere in Europe, the Norwegian krone (NOK) is weakening (vs. the EUR) in response to softer oil prices. 
Turning to Food for Thought, we have 3 items today: 
1. According to

- "More women work in middle-skill jobs than men, but men dominate jobs that actually pay well."
women at work
- "Women invest more in their educations but get a worse return on that investment than men." 
women education investment
2. In the United States, more women now earn a 4-year college degree than men.
women degrees
3. Here is a new study from Pew on US women in the political process.

- Voting patterns of US women in past elections. 
female voting patterns
 — Edited by Clemens Bomsdorf

* Walter Kurtz is an alias

**This is an abridged version of the Daily Shot. To subscribe to the full version, link to the Daily Shot and select the appropriate command. E-mail addresses are never shared with anyone.



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