The Apollo RT6 comes with a detachable steering wheel, as the car will no longer necessarily need one to drive.
Biden says he expects to speak with China’s Xi in 10 days
U.S. President Joe Biden said he expects to speak with Chinese President Xi Jinping for the first time since March.
Domino’s earnings miss expectations as pizza chain cites tough labor market, higher costs
The ongoing shortage of delivery drivers hurt the chain’s sales again this quarter.
American Airlines forecasts third-quarter profit but scales back growth after flight disruptions
American’s CEO said the carrier would limit its expansion this year.
Goldman-backed digital bank Starling reports its first annual profit as other fintechs stumble
British digital bank Starling reported its debut annual profit Thursday as revenues at the firm almost doubled.
United Airlines posts profit on travel surge but holds back on flight growth
United Airlines on Wednesday notched a key profit milestone in its pandemic recovery.
Tesla grows revenue 42%, but automotive margins decline
Tesla’s margins were impacted by inflation and fiercer competition for the components that go into EVs.
ForexLive European FX news wrap: Nord Stream restart, Draghi resigns
Headlines:
- Dollar turns to gains after early stumble
- Gas deliveries reportedly to have resumed via Nord Stream 1 pipeline
- Italian prime minister Draghi: I will resign
- Italian bonds slump hard amid political upheaval
- It is shaping up to be another stinging day for oil
- BOJ’s Kuroda: Will not hesitate to ease monetary policy further if necessary
- BOJ’s Kuroda: A large rate hike would be needed to stop yen weakness
Markets:
- EUR leads, NZD lags on the day
- European equities lower; S&P 500 futures down 0.2%
- US 10-year yields up 2 bps to 3.056%
- Gold down 0.8% to $1,683.33
- WTI crude down 4.6% to $95.23
- Bitcoin down 2.6% to $22,646
It is a big morning in Europe with two out of three key risk events having played out. The Nord Stream 1 pipeline saw gas flows restart and return back to capacity prior to the maintenance period i.e. 40% or 67 million cubic metres. That provided some early relief for the euro before Italian prime minister Draghi announced his resignation, as expected.
EUR/USD climbed up from 1.0200 to 1.0230 early on before being pulled back to 1.0170-80 levels at the moment. The dollar was also initially softer before finding a footing as risk sentiment also erred slightly more negatively during the session.
USD/JPY pushed up from 138.30 to 138.70-80 levels as the BOJ stood pat and Kuroda reaffirmed that the central bank isn’t going to be shifting its policy stance any time soon.
GBP/USD hit a high of 1.2003 in the handover from Asia to Europe but settled lower as the dollar came back, falling to 1.1920 and is holding just above that now.
As equities eased lower, the aussie and kiwi also saw early advances turn the other direction with AUD/USD falling from 0.6910 to 0.6870 and NZD/USD from 0.6240 to 0.6190 – keeping at the lows for the day currently.
It is on to the ECB next as the final key risk event for the euro today.
This article was written by Justin Low at www.forexlive.com.
Two things to watch in the ECB policy decision today
If you want some foreshadowing, I’ve got you covered here. As such, let’s get straight into this.
25 bps or 50 bps?
This seems to be the main thing that everyone will be watching first. As the ECB is set to deliver its first rate hike in 11 years, there are still questions surrounding how much the central bank will move. 25 bps was pretty much a given right until early this week, where there were reports suggesting that policymakers could consider moving by 50 bps instead.
The odds coming into today suggest that market pricing is pretty much a coin flip, even if economic estimates are siding with a 25 bps move. That tees up quite a dilemma for the euro and European bond yields in interpreting the immediate decision. A 25 bps move will see the euro fall alongside yields while a 50 bps move will see the opposite reaction.
That said, the latter scenario may see euro gains be short-lived as there are still plenty of economic headwinds for the currency and the region in the months ahead. A 50 bps move today will do little to change those circumstances.
Anti-fragmentation tool announcement
Too little time. That’s my view on the matter as the ECB has rushed things in order to try and appease markets but have found themselves pressured by Italy’s political upheaval at the moment. The thing I fear is that markets will leave disappointed when the ECB offers a lack of details and no strong views on the exact functionalities of the tool, and that could see bond spreads blow up – much more than they already have after Italy’s predicament earlier here.
As I type this, the spread between 10-year Italian and German bond yields has widened to 237 bps on the day.
I would expect Lagarde to exert the notion that the tool will have no limits and no conditionality. It will take the best parts of the other tools from the ECB aimed at dealing with spreads but again, can words really cover it? If it doesn’t and markets are not satisfied, the euro will have to suffer yet another gut punch before the week is over.
This article was written by Justin Low at www.forexlive.com.
Italy elections reportedly may take place on 18 September
Most of the rumours swirling have been around late September or early October so this one is a little bit on the earlier side. In any case, it is the only direction that we are headed for and given the recent political fracture in the government coalition, the center-right bloc (Brothers of Italy, Lega, Forza Italia) may be set for a big win.
This article was written by Justin Low at www.forexlive.com.