Japan’s Trade Ministry is set to ask for 2.3596 trillion yen in its preliminary budget request for FY2025/26, according to Jiji.

This article was written by Arno V Venter at www.forexlive.com.

US MBA mortgage applications: 0.5% vs -10.1% prior

US MBA mortgage market index: 226.9 vs 225.8 prior

US MBA purchase index: 131.8 vs 130.6 prior

US MBA refinancing index: 753.8 vs 754.4 prior

US MBA 30-year mortgage rate: 6.44% vs 6.50% prior

This article was written by Arno V Venter at www.forexlive.com.

• China’s Foreign Minister Wang Yi, in a meeting with U.S. National Security Adviser Sullivan, emphasized the importance of treating each other as equals for the smooth development of China-US interactions – Chinese state media.
• Wang Yi advised the U.S. not to judge China based on the path it has traveled nor to view China through the lens of a hegemonic strong country – state media.
• Wang Yi called for the U.S. to cease suppressing China in areas such as trade, commerce, science, and technology, and to stop jeopardizing China’s legitimate interests – state media.
• He criticized protectionism under the guise of ‚overcapacity‘, stating it would jeopardize global green development and impact world economic growth – state media.
• Wang Yi urged the U.S. to adhere to its commitment not to support ‚Taiwan independence‘, to stop arming Taiwan, and to support the peaceful ‚reunification‘ of China – state media.
• He asserted that Taiwan ‚belongs to‘ China and that ‚Taiwan independence‘ poses the greatest risk to peace and stability in the Taiwan Strait – state media.
• Wang Yi warned the U.S. against undermining China’s sovereignty and territorial integrity under any pretext, and not to support or condone what he termed the Philippines‘ ‚infringing acts‘.
• He criticized the U.S. for not taking responsibility regarding the Ukraine crisis and for imposing ‚illegal‘ unilateral sanctions indiscriminately.
• Both sides agreed to hold video calls between the two militaries‘ theater leaders at an appropriate time – state media.
• China’s Foreign Minister Wang Yi, in a meeting with U.S. National Security Adviser Sullivan: Two sides discussed a new round of interaction between the two heads of state in the near future – state media.

This article was written by Arno V Venter at www.forexlive.com.

• As long as disinflation path converges to 2% before end of 2025, then I’m comfortable with gradual policy easing.

There is nothing new here. The market sees a 100% chance of a cut in September and a total of 64 bps of easing by year-end.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

• Things to look out for in today’s Consumer Confidence data
• Lavrov condemns Ukraine’s demands and warns West against ‚playing with fire‘
• UK CBI Distributive Trades -27 vs -43 prior
• Markets still leaning mostly risk on as we head deeper into the session
• UK PM Starmer warns of ‚painful‘ October budget,
• Two Libyan oilfields shut and another at lowest output
• BofA is bulilsh on the AUD due to differentials and a weaker USD
• UBS hikes US recession odds to 25% from prior 20%
• Today’s FX option expiry levels for the NY cut
• EURUSD has been following yield differentials higher
• What are the main events for today?
• Equity futures mostly green across the board this morning
• German detailed YY GDP 0.0% vs -0.1% expected
• German Consumer sentiment -22 vs -18.2 expected
• Swedish PPI YY for July -0.1 vs 0.8% prior
• BofA likes the USD lower and GBP higher
• Goldman maintains recommendation to stay long GBPCHF
• Fed officials keep door to 50bp cuts open

Markets:

• GBP leads, USD lags on the day
• European equities flat; S&P 500 futures down 0.05%
• US 10-year yields up 3 bps to
  3.848%
• Gold
  down 0.30% to $2,510
• WTI
  crude down 0.57% to $76.98
• Bitcoin
  down 0.61% to $62,438

It was another
quiet session with no market moving data releases. The only notable news was
UK’s PM Starmer warning of “painful” budget in October which hints to tax
rises, although he promised not to raise them for working people.

In the
markets, there’s been very little movement. The most notable moves have been in
the bond market where long-term Treasury yields have been rising faster than
short-term ones. Although that could be just daily noise, it’s something to
keep an eye on as the Fed cuts into a resilient economy (at least for now).

The focus
will now switch to the American session where the labour market data in the US
Consumer Confidence report will take the centre stage.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

With all the focus on the labour market right now, there are a few data points within today’s Consumer Confidence report that could get some attention and worth being aware of.

1. Jobs hard to find (overlaying this with the unemployment rate should explain why it’s useful and why it would matter going into next week’s jobs data).

2. Ratio between Jobs plentiful and jobs not so plentiful (a big drop in this one can get attention as well)

3. Ratio of Present situation versus forward expectations (this has in past cycles offered a fairly decent trigger or warning of slowdown conditions – but please keep in mind this has not been a regular cycle so pinch of salt, but the current macro context makes this interesting)

Unfortunately these aren’t part of the usual calendar release which is usually only the headline number, so it will require some digging in the report. But big surprises in these ones could get more attention today and worth keeping on the radar.

This article was written by Arno V Venter at www.forexlive.com.

• Russian Foreign Minister Lavrov on Ukraine’s demands that the West let it strike deep into Russia: „This is blackmail.“
• Russian Foreign Minister Lavrov: Russia has its own nuclear weapons doctrine, which is being adjusted.
• Russian Foreign Minister Lavrov: Playing with fire is very dangerous for those who are entrusted with nuclear weapons in the West.

This article was written by Arno V Venter at www.forexlive.com.

GB CBI Distributive Trades -27 vs -43 prior

This article was written by Arno V Venter at www.forexlive.com.

• Libya’s Al Waha Company says it will start partial reduction in production
• WTI extends gains with news that Libya will be stopping all production and exports
• Earnings in focus this week again with Nvidia
• Germany received a tip-off about potential Russian sabotage act at a NATO site
• FX not playing ball with commodities and equity performance today
• Atlanta Fed GDPNow sitting at 2%
• Germany Aug Ifo business climate index 86.6 vs 86.0 expected
• Heads up that this week is month-end
• Weekly update on interest rates expectations
• Riksbank meeting minutes
• Markets hold to a view of >100 bp of cuts for the Fed by year-end
• What are the main events for today?
• Swiss Non-Farm Payrolls 5.499 vs 5.484M prior
• Conditions for sustained USD weakness not fully in place
• Japan leading indicator -2.1 vs -2.6 prior
• Equity and bond expectations divergence likely to be bullish for the USD
• India GDP seen at 6.9% in April to June vs 7.8% in previous quarter
• Most commodities are trading in the red apart from oil

Markets:

• JPY leads, NZD lags on the day
• European equities flat; S&P
  500 futures up 0.15%
• US 10-year yields up 2 bps
  to 3.81%
• Gold
  up 0.36% to $2,521
• WTI
  crude up 2.69% to $76.84
• Bitcoin down 0.48% to $63,953

It was a classic
quiet Monday session with little in terms of market moving data releases. The
only highlight was the German IFO reading which came out basically in line with
estimates.

The only major
news was the Libyan eastern-based government declaring the closing down of all oil
fields and halting production and exports as a force majeure announced in
response to the attempts to take over the central bank by the Tripoli-based
government.

In the
markets, there’s been very little movement with just crude oil getting the
attention following the Libyan news as the price shot 1.5% higher and counting.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

Oil continues to extent on gains after Libya announced a force majeure on all facilities, terminals and oil fields.

Next major resistance on the chart is the 200DMA coming up around $77.76. It also has confluence with the 2 standard deviation implied volatility high for the day.

This article was written by Arno V Venter at www.forexlive.com.