Wednesday 31st August: European Open Briefing

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Global Markets:

  • Asian stock markets: Nikkei up 0.95 %, Shanghai Composite gained 0.30 %, Hang Seng fell 0.10 %, ASX 200 declined 0.70 %
  • Commodities: Gold at $1318 (+0.15 %), Silver at $18.80 (+1.20 %), WTI Oil at $46.40 (+0.10 %), Brent Oil at $48.75 (+0.05 %)
  • Rates: US 10 year yield at 1.58, UK 10 year yield at 0.64, German 10 year yield at -0.09

News & Data:

  • Japan Industrial Production (MoM, Jul): 0.0% (est 0.80%, prev 2.30%)
  • Japan Industrial Production (YoY, Jul): -3.80% (est -3.00%, prev -1.50%)
  • Japan Construction Orders (YoY, Jul): -10.90% (prev -2.40%)
  • Japan Housing Starts (YoY, Jul): 8.90% (est 7.40%, prev -2.50%)
  • Japan Small Business Confidence (Aug): 46.30 (prev 47.80)
  • Australia Private Sector Credit (MoM, Jul): 0.40% (est 0.40%, prev 0.20%)
  • Australia Private Sector Credit (YoY, Jul): 6.00% (est 6.10%, prev 6.20%)
  • New Zealand ANZ Business Confidence (Aug): 15.5 (prev 16)
  • New Zealand ANZ Activity Outlook (Aug): 33.7 (prev 31.4)
  • New Zealand M3 Money Supply (Jul, YoY): 6.30% (prev 5.90%)
  • China Westpac/MNI Consumer Sentiment (Aug): 111.5 (prev 114.0)
  • UK GfK Consumer Confidence (Aug): -7 (est -8, prev -12)
  • UK Lloyds Business Barometer (Aug): 16 (prev 29)
  • South Korea Industrial Production (MoM, Jul): 1.40% (est -0.60%, prev rev to -0.40% from -0.20%)
  • South Korea Industrial Production (YoY, Jul): 1.60% (est 0.40%, prev 0.80%)
  • PBOC fixes yuan at 6.6908 (vs. prev fix 6.6812, prev close 6.6820)
  • Yuan fixed at lowest levels vs the USD since 20/Jul –BBG

Markets Update:

The US Dollar retraced some of its recent gains as risk appetite improved. The New Zealand Dollar was the best performing currency overnight and NZD/USD rallied from 0.7205 to a high of 0.7255. AUD/USD followed it higher and rose from 0.75 to 0.7530. Meanwhile, the Canadian Dollar remains under pressure as Oil prices continue to decline. USD/CAD declined slightly in Asia, but found good support at 1.3080.

USD/JPY remains well bid and the risk-on sentiment is providing it with some additional support. The pair traded as high as 103.22 overnight, a fresh one-month high. With 103.00 resistance cleared, the next level to watch is 104.00, followed by 105.00/20.

EUR/USD was quiet as usual, trading in a 1.1135-60 range. Meanwhile, GBP/USD rallied from 1.3065 to a high of 1.3115 after the Tokyo open.

Upcoming Events:

  • 07:00 BST – German Retail Sales
  • 07:45 BST – French CPI
  • 08:55 BST – German Unemployment Rate
  • 09:00 BST – Norway GDP
  • 10:00 BST – Italian CPI
  • 10:00 BST – Euro Zone CPI
  • 13:15 BST – US ADP Nonfarm Employment Change
  • 13:30 BST – Canadian GDP
  • 14:45 BST – US Chicago PMI
  • 15:00 BST – US Pending Home Sales
  • 15:30 BST – US Crude Oil Inventories

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