Global Markets:
- Asian stock markets: Nikkei fell 2.85%, Shanghai Composite fell 1.08%, Hang Seng fell 2.38%, ASX200 fell 2.22%
- Commodities: Gold at $1106.80(-0.09%), Silver at $14.61(-0.09%), WTI Oil at $44.11 (-0.09%), Brent Oil at $47.40 (-0.38 %)
- Rates: US 10 year yield at 2.18% UK 10 year yield at 1.87%, German 10 year yield at 0.70%
News & Data:
- BoK Gov Lee: Any Shock From Fed Hike On South Korea Will Be Limited, Countermeasures Are Prepared
- BoK: China Financial Market Instability Is Risk – Inflation To Remain Low
- BoK Keeps Its 7 Day Repo Rate On Hold At 1.50% As Expected
- Iran Drops Crude Price To 3-Year Low To Win Asia Market Share – RTRS
- US DOE Crude Oil Inventory Change (WoW) (Sep 04): 2570K (est 900K, prev 4667K)
- Larry Summers: Reiterates Fed Should Delay Rate Hike – CNBC
- Larry Summers: Time To Hike Is When Inflation Looks To Break 2%
- US Import Price Index (MoM)(Aug): -1.80% (est -1.60%, prev -0.90%) -Import Price Index (YoY) (Aug): -11.40% (est -11.10%,rev prev -10.50%)
- US Initial Jobless Claims (Sep 05): 275K (est 275K, rev prev 281K – Continuing Claims (Aug 29): 2260K (est 2253K, rev prev 2259K)
- BoE Minutes: Inflation below target, 3/4 of this is due to low contributions from energy and food
- BoE Minutes: China and EM volatility a main point of discussion, led to volatility in other markets, Greek concern has receded
Major currencies update: After yesterday’s period of consolidation following a rapid rally in price, the pound has continued its northbound move after finding a firm base at 1.5350, rallying to a current spot price of 1.5450. Reaction to BoE minutes was largely isolated volatility, and did not prove much of a threat to the continued move to the upside, as rates remain on hold, and minutes reiterated common concerns already present within policymakers of recent China and EM volatility. The Euro also rallied, breaking out of its previous range of 1.1130-1.1200, with spot now trading sub 1.1300. On the case of the USD/JPY, the pair rallied as well in yesterday’s trading, forming an intraday high at 121.30, before retracing in late US trading to 120.60-120.70. Key resistance is eyed at 121.70, with support at 119.00.
Commodity currencies update: The Aussie continued its upward gains post-positive Australian employment data, rallying 120 pips post-event, with spot shy of testing the 0.7100 figure. The pair is currently consolidating in the Asian session, with spot currently at 0.7065. With the Kiwi, the pair remained to trade within its 0.6250-0.6420 range, retracing however, on downside momentum generated post-RBNZ rate cut. The pair has hit a high of 0.6335 in yesterday’s trading, with spot trading at the 0.6300 figure at the moment.
Upcoming Events:
- ALL DAY – ECOFIN Meetings
- 12:30 BST – UK MPC Member Forbes Speaks
- 13:30 BST – US PPI m/m, Core PPI m/m
- 15:00 BST – Preliminary University of Michigan Consumer Sentiment
