Global Markets:
- Equities: Nikkei up 0.35 %, Shanghai Composite fell 0.50 %, Hang Seng declined 0.30 %, ASX 200 rose 0.20 %
- Commodities: Gold at $1352 (-0.40 %), Silver at $19.63 (-0.60 %), WTI Oil at $48.35 (+0.30 %), Brent Oil at $50.90 (-0.05 %)
- Rates: US 10 year yield at 1.55, UK 10 year yield at 0.55, German 10 year yield at -0.09
News & Data:
- NZ Credit Card Spending (MoM) Jul: 2.3% (prev -0.8%)
- NZ Credit Card Spending (YoY) Jul: 5.6% (prev 4.1%)
- Japan Reuters Tankan Manufacturers Index Aug: 1 (prev 3)
- Japan All Industry Activity Index (MoM) Jun: 1.0% (est 0.9%, prev -1.0%, rev -1.3%)
- PBOC Fixes Yuan Reference Rate at 6.6211 (prev 6.6273)
- Fed’s Williams: September rate hike should definitely be in play
- Williams calls for raising rates sooner rather than later; delaying risks recession
- Williams: Not in hurry to hike but can’t let economy overheat
- Williams: Wage growth beginning to pick up
- Williams: Negative rates would have bigger costs than benefits
- Brent crude oil prices dip on U.S. profit taking – RTRS
- Dollar nurses losses vs euro after Fed minutes quash hawks' hopes – RTRS
Markets Update:
The US Dollar regained some strength overnight after hawkish comments from Fed's Williams. EUR/USD fell from 1.1365 in the early Asian session to a low of 1.1327, while GBP/USD declined from 1.3180 to 1.3130. GBP/USD has been bid in the past few sessions amid a short squeeze, but it ran into decent resistance now at 1.3170/80 and the rally could stall here. Meanwhile, USD/JPY is back above 100. Many traders expected a sharp sell-off once the 100 level was taken out, but that did not happen and the pair continues to consolidate. While there have not been any signs of a BoJ intervention yet, they are closely watching.
The commodity currencies declined overnight. The Australian Dollar lost 0.60 % and fell from 0.7690 to 0.7625 against the US Dollar. Meanwhile, the New Zealand Dollar declined from 0.7290 to 0.7240. USD/CAD bounced off 1.2765 support and made it to 1.2810 overnight, but remains under pressure overall, as Oil prices continue to rally.
Upcoming Events:
- 07:00 BST – German PPI
- 13:30 BST – Canadian CPI
- 13:30 BST – Canadian Retail Sales
