United Kingdom
Market review
Bank of England (BoE): In contrast to the US and eurozone, inflation remained stubbornly high, with data for March above 10% year on year. Core inflation, excluding more volatile food and energy components, was unchanged at 6.2%. Wage growth, seen by many as a risk to future inflation if it is not contained, was steady as average weekly earnings growth (including bonuses) was 5.9% year-on-year. The IMF revised its forecast for UK growth upwards, but the economy is still expected to contract this year by 0.3%. The gap between wage growth and inflation demonstrates the extent to which real wages have been eroded, putting pressure on the UK economy. It was perhaps surprising then that the British Retail Consortium’s Retail Sales Monitor showed growth steady at 4.9% over the past year. As if to emphasise the point, the GfK Consumer Confidence Barometer increased to -30 in April, from -36.
European Central Bank (ECB): The steady improvement in confidence across the euro area suffered a second setback in April, as the ZEW Economic Sentiment Indicator declined to 6.4, having been as high as 29.7 in February. Inflation continued to fall back and the first estimate for German inflation in April was 7.2%, down from 7.4% the month before. Economic sentiment remains fragile with the indicator from the European Commission rising just marginally while still failing to break above 100. In Germany, the Ifo Business Climate indicator edged higher to 93.6, just below wider expectations, while the GfK Consumer Climate Indicator increased sharply, reaching -25.7, a seventh consecutive improvement, and its highest level since April 2022. The ECB did not have a policy meeting but several rate-setting members have indicated that more tightening is to come, and those hikes could exceed what markets currently expect.
US Federal Reserve (Fed): There was no Federal Reserve rate-setting meeting during the month, though minutes of the March meeting revealed concerns that the economy would fall into recession later in the year. The annual rate of headline inflation dropped to 5%, slightly below market forecasts. It marked the ninth successive monthly decline and the lowest figure for nearly two years. At the same time, core inflation edged back up marginally to 5.6%. Jobs growth eased to its slowest rate for over a year, with just 236,000 new jobs according to the non-farm payrolls data, fewer than the market had been anticipating. The participation rate continued to climb, reaching 62.6%, its highest level since COVID-19 struck, but it remains below pre-pandemic levels. Sentiment indicators were mixed as the Michigan Consumer Sentiment Index of Consumer Expectations and the New York Empire State Manufacturing Index both rose by more than had been expected, while the Philadelphia Fed Manufacturing Index fell to -31.3, the lowest level since March 2020. Toward the end of the month, the first estimate of GDP growth for Q1 showed a weaker-than-expected expansion of 1.1% quarter-on-quarter. 
Source: Insight and Bloomberg. Data as at 30 April 2023.
Key interest rates, global data and insight cash fund performance
Insight Money Market Funds performance
For the full list of prices for Insight’s money market funds, please click here.
