Sandbags limit-down as London opens

Panic officially over

The two years that it will take for Britain to leave the EU are but the blink of an eye. Britain's first ultra-modern F35 fighter jet arrived yesterday, ten years after its maiden flight. Air bags were invented 65 years ago and still don't work properly.

In that context, the six days that it has taken for sterling to stabilise following Britain's vote to leave the EU are no time at all. It does not matter that there might in time be new shocks that will send it lower: this one seems to have run its course. All the known bad news has been priced into sterling.

For a second day on Wednesday sterling managed to make another 0.1% of progress, on average, against the other dozen most actively-traded currencies. Once again the safe-haven currencies were to the rear, the South African rand was the top-performing currency and share prices were higher. The panic is over and investors have rediscovered some appetite for risk.

Daily data

Fortunately, Wednesday's economic statistics did nothing to spoil the mood. Most of them met or exceeded analysts' predictions. Those that failed to do so didn't matter.

Although it dated from well before the referendum, May's 67k increase in UK mortgage approvals showed an improvement on the month instead of the expected slowdown. Consumer credit and personal loans were also well ahead of forecast. Norwegian retail sales were robust, having been expected to be flat. German inflation at 0.3% in June was a tick short of the forecast 0.4% but still better than the previous month's 0.1%.

The numbers which failed to impress were the ones that seldom attract attention. Official Euroland confidence measures were patchy: industry was more upbeat but consumers were not. In the States personal income and spending were so-so and pending home sales were down by more than expected in May.

History lesson

The most important numbers on today's list date back more than three months. The second most important are incapable of affecting monetary policy and the also-rans would have minimal impact even at the best of times. But, as was the case yesterday, some could cloud the atmosphere if they were to disappoint.

The most ancient among the bunch are the figures for Britain's gross domestic product in the first quarter, which gets its second revision. Quarterly growth is expected to be unchanged at 0.4%. The most irrelevant are June's inflation data from the euro zone and (tonight) Japan. Neither the European Central Bank nor the Bank of Japan is going to tighten monetary policy: the only question is whether they will ease further and those decisions will have little to do with the rate of inflation.

Tomorrow marks the beginning of the monthly festival of purchasing managers' indices. Britain's manufacturing sector should be marginally positive.