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  • At the start of last week Investors received some positive news flow with regards the ongoing US China trade war. There were suggestions that an agreement to Phase 1 of the negotiations would be shortly signed and more importantly there would be a gradual roll back of existing tariffs. As the week progressed however, sentiment became less positive with both parties struggling to agree on a location for this signing and the emergence of expected political criticism from Democrats on the details of the proposed Trade Deal.
  • The European Commission downgraded their economic forecasts for 2020 but more significantly they remained relatively pessimistic on growth post this year in spite of expectations of fiscal stimulus from some countries.
  • The Bank of England kept interest rates (see chart) on hold however, there were two dissenters amongst Board members who desired an immediate interest rate cut reflecting the impact of the global slowdown on the UK economy. The economic fundamentals remain overshadowed by the ongoing General Election deliberations however, one common characteristic from the Conservatives and Labour parties is the desire to introduce a material fiscal stimulus.