Monday 12th September: European Open Briefing

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Monday 12th September: European Open Briefing 1

Global Markets:

  • Asian stock markets: Nikkei down 1.70 %, Shanghai Composite declined 2.10 %, Hang Seng fell 2.70 %, ASX 200 lost 2.10 %
  • Commodities: Gold at $1332 (-0.20 %), Silver at $19.01 (-1.85 %), WTI Oil at $45.20 (-1.50 %), Brent Oil at $47.40 (-1.30 %)
  • Rates: US 10 year yield at 1.67, UK 10 year yield at 0.86, German 10 year yield at -0.02

News & Data:

  • Japan PPI (MoM) Aug: -0.3% (est -0.1% prev 0.0%)
  • Japan PPI (YoY) Aug: -3.6% (est -3.4% prev 3.9%)
  • Japan Machine Tool Orders (MoM) Aug: 4.9% (est -2.9% prev 8.3%)
  • Japan Machine Tool Orders (YoY) Aug: 5.2% (est 0.3% prev -0.9%)
  • PBoC Fixes Yuan at 6.6908 (prev 6.6684)
  • BoJ to Weigh Different Approach, But Markets Wonder What Next — Nikkei
  • Fed's Kaplan: Progress Toward Full Employment, Lagging On Meeting Inflation Target
  • Fed's Kashkari: Monetary Policy 'Largely Doing What It Can' To Support Robust Recovery — RTRS

CFTC Positioning Data:

  • EUR 93K short versus 82K short last week
  • GBP 90K short versus 92K short last week
  • JPY 54K long versus 64K long last week
  • CHF 1.4K long versus 8K long last week
  • CAD 21K long versus 22K long last week
  • AUD 39K long versus 43K long last week
  • NZD 6.1K long versus 1.8 K long last week

Markets Update:

Asian stock markets are all lower, with Chinese and Australian markets down more than 2 % on the day, as rates rose sharply on Friday and investors see an increased chance of a Federal Reserve rate hike this month. As a reminder, the Fed will announce its decision on September 21st.

The FX market was rather quiet overnight, despite decent volatility in the equities and commodities. EUR/USD opened around 1.1225 in Asia and rose to a high of 1.1250. GBP/USD started the new trading day at 1.3260 and traded in a 1.3250-75 range. USD/JPY consolidated between 102.60 and 102.30 and remained surprisingly bid, despite larger losses in the Nikkei index.

AUD/USD opened at 0.7540 and traded in a 0.7520-50 range overnight. Similar price action was seen in NZD/USD, which consolidated between 0.7315-45.

There are no major data releases or events scheduled for today, so it could remain quiet. This week’s main events will be UK inflation & unemployment data, the SNB and BOE rate decision and US inflation data. For further details, please see the calendar below.

Upcoming Events:

  • 14:30 BST – UK CB Leading Index

The Week Ahead:

Tuesday, September 13th

  • 02:30 BST – Australia NAB Business Confidence
  • 03:00 BST – Chinese Industrial Production
  • 03:00 BST – Chinese Retail Sales
  • 07:00 BST – German CPI
  • 08:15 BST – Swiss PPI
  • 09:00 BST – Italian Industrial Production
  • 09:30 BST – UK CPI
  • 10:00 BST – German ZEW Economic Sentiment
  • 10:00 BST – Euro Zone ZEW Economic Sentiment
  • 23:45 BST – New Zealand Current Account

Wednesday, September 14th

  • 01:30 BST – Australia Westpac Consumer Sentiment
  • 05:30 BST – Japanese Industrial Production
  • 07:45 BST – French CPI
  • 09:00 BST – Italian CPI
  • 09:30 BST – UK Unemployment Rate
  • 09:30 BST – UK Claimant Count Change
  • 09:30 BST – UK Average Earnings
  • 10:00 BST – Euro Zone Industrial Production
  • 15:30 BST – US Crude Oil Inventories
  • 23:45 BST – New Zealand GDP

Thursday, September 15th

  • 02:00 BST – Australia MI Inflation Expectations
  • 02:30 BST – Australia Employment Change
  • 02:30 BST – Australia Unemployment Rate
  • 06:00 BST – Singapore Retail Sales
  • 08:30 BST – SNB Rate Decision
  • 09:30 BST – UK Retail Sales
  • 10:00 BST – Euro Zone CPI
  • 10:00 BST – Euro Zone Trade Balance
  • 12:00 BST – Bank of England Rate Decision
  • 13:30 BST – US Retail Sales
  • 13:30 BST – US Current Account
  • 13:30 BST – US Initial Jobless Claims
  • 13:30 BST – Philadelphia Fed Manufacturing Index
  • 13:30 BST – US PPI
  • 14:15 BST – US Industrial Production
  • 14:15 BST – US Manufacturing Production

Friday, September 16th

  • 09:00 BST – Italian Trade Balance
  • 13:30 BST – US CPI
  • 15:00 BST – US Michigan Consumer Sentiment

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