Tuesday 30th August: European Open Briefing

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Global Markets:

  • Asian stock markets: Nikkei down 0.05 %, Shanghai Composite gained 0.05 %, Hang Seng rose 0.70 %, ASX 200 up 0.30 %
  • Commodities: Gold at $1327 (+0.05 %), Silver at $18.76 (-0.05 %), WTI Oil at $47.20 (+0.45 %), Brent Oil at $49.55 (+0.20 %)
  • Rates: US 10 year yield at 1.58, UK 10 year yield at 0.57, German 10 year yield at -0.05

News & Data:

  • Japan Unemployment Rate (Jul): 3.00% (est 3.10%, prev 3.10%)
  • Japan Jobs/Applications Ratio (Jul): 1.37 (est 1.38, prev 1.37)
  • Japan Household Spending (MoM) (Jul): 2.50% (est 1.10%, prev -1.10%)
  • Japan Household Spending (YoY) (Jul): -0.50% (est -0.90%, prev -2.20%)
  • Japan Retail Trade (YoY, Jul): -0.20% (est -0.90%, prev rev -1.30%)
  • Japan Retail Sales (MoM, Jul): 1.40% (est 0.80%, prev rev 0.30%)
  • Australia ANZ/Roy Morgan Weekly Consumer Confidence Index (28/Aug): 118.4 (prev 121.8)
  • Australia Building Approvals (MoM, Jul): 11.30% (est 1.10%, prev -2.90%)
  • Australia Building Approvals (YoY, Jul): 3.10% (est -8.30%, prev -5.90%)
  • New Zealand Building Consents (MoM, Jul): -10.5% (prev 16.3%)
  • UK CBI Services Sector Survey: Business Optimism: -30 (prev: -5)
  • UK CBI Consumer Optimism: -37 (prev: 9)
  • UK CBI: Services sector optimism drops sharply post-Brexit
  • PBoC fixes yuan at 6.6812 (vs prev 6.6856, prev close 6.6838)
  • RBNZ's McDermott: Confident inflation will rise naturally to the 1-3% band, RBNZ will do what is appropriate to raise inflation
  • RBNZ's McDermott: Don't think we are getting to zero rate, monetary policy still works

Markets Update:

The US Dollar appreciated against most major currencies overnight. USD/JPY bounced off 101.75 support ahead of the Tokyo open and rallied to a high of 102.25. The chance of a Fed rate hike this year has increased and continues to keep the USD supported. Traders are now looking forward to the main event of this week – NFP on Friday. A strong number could make it difficult for the Fed to wait much longer with a rate hike.

EUR/USD traded 1.1170-90 overnight, while GBP/USD spent the session in a 1.3075-1.3120 range. Trading has been subdued yesterday amid an UK bank holiday and lack of data/events.

AUD/USD traded slightly lower in the early Asian session and reached a low of 0.7560, but eventually recovered and made it back to 0.7575. NZD/USD is consolidating around 0.7250 and is basically unchanged on the day.

Upcoming Events:

  • 07:00 BST – German Import Price Index
  • 08:00 BST – Spanish CPI
  • 10:00 BST – Euro Zone Consumer Confidence
  • 13:00 BST – German CPI
  • 15:00 BST – US CB Consumer Confidence

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