<ul><li>Corporate bond auctions will commence from the week starting 19 September</li><li style=““ class=“text-align-justify“>Only bonds that mature on or after 6 April 2024 will be eligible for sale via the first instance</li><li style=““ class=“text-align-justify“>Nominal value of bonds eligible for sale via auctions is currently £13 billion</li><li style=““ class=“text-align-justify“>The pace of auction sales will be gradual and responsive to prevailing market conditions</li></ul><p style=““ class=“text-align-justify“>Some added details are that the auctions will typically be held twice a week, on Tuesday and Wednesday from 1100 to 1130 London time. And the average pace of sales during the auctions should be around £200 million per week.</p>

This article was written by Justin Low at www.forexlive.com.

<ul><li>Core CPI +4.0% vs +4.0% y/y prelim</li></ul><p style=““ class=“text-align-justify“>No change to the initial estimates as euro area inflation continues to surge higher. That continues to make it a tough balancing act for the ECB.</p>

This article was written by Justin Low at www.forexlive.com.

<p>Headlines:</p><ul><li><a target=“_blank“ href=“https://www.forexlive.com/news/uk-july-cpi-101-vs-98-yy-expected-20220817/“>UK July CPI +10.1% vs +9.8% y/y expected</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/sterling-does-the-rise-and-fall-as-uk-inflation-hits-40-year-high-20220817/“>Sterling does the rise and fall as UK inflation hits 40-year high</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/the-surge-in-uk-yields-is-rippling-across-global-bonds-20220817/“>The surge in UK yields is rippling across global bonds</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/kiwi-fails-to-find-comfort-from-hawkish-rbnz-20220817/“>Kiwi fails to find comfort from hawkish RBNZ</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/eurozone-q2-gdp-second-estimate-06-vs-07-qq-prelim-20220817/“>Eurozone Q2 GDP second estimate +0.6% vs +0.7% q/q prelim</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/us-mba-mortgage-applications-we-12-august-23-vs-02-prior-20220817/“>US MBA mortgage applications w.e. 12 August -2.3% vs +0.2% prior</a></li><li><a target=“_blank“ href=“https://www.forexlive.com/news/musk-clarifies-tweet-about-man-utd-bid-says-he-is-not-buying-any-sports-teams-20220817/“>Musk clarifies tweet about Man Utd bid, says he is not buying any sports teams</a></li></ul><p>Markets:</p><ul><li>USD leads, AUD lags on the day</li><li>European equities lower; S&P 500 futures down 0.9%</li><li>US 10-year yields up 6 bps to 2.885%</li><li>Gold down 0.4% to $1,768.73</li><li>WTI crude down 0.2% to $86.33</li><li>Bitcoin down 0.9% to $23,754</li></ul><p style=““ class=“text-align-justify“>The day began with some shenanigans involving Elon Musk as he joked about buying Manchester United. It was some entertainment to kick start proceedings before markets quickly focused on the double-digit UK inflation print, the highest in 40 years.</p><p style=““ class=“text-align-justify“>The pound got a knee-jerk push higher only to fall back almost immediately, as traders reassess the dire outlook to the UK consumer. GBP/USD moved up from 1.2110 to 1.2140 before falling back now to fresh lows of 1.2060 as the dollar is seen firming across the board.</p><p style=““ class=“text-align-justify“>The UK inflation data kicked off a heavy round of selling in the bond market with UK yields surging and that spilled over to Europe and the US as well. 10-year Treasury yields are now knocking on the door of its 100-day moving average near 2.89% and that is underpinning USD/JPY to move up just above 135.00 on the day.</p><p style=““ class=“text-align-justify“>Higher yields seems to also be taking a toll on equities with US futures marked lower, after also having seen the S&P 500 test its 200-day moving average in trading yesterday. S&P 500 futures are down 0.9% and that is reflecting a more risk-off mood where the dollar is gaining all across the board.</p><p style=““ class=“text-align-justify“>USD/CAD is back up by 0.5% to above 1.2900 while AUD/USD is down over 1.3% to 0.6930 and NZD/USD down 0.9% to 0.6285, with the kiwi failing to even find any comfort from a more hawkish RBNZ earlier in the day.</p><p style=““ class=“text-align-justify“>It is now over to US retail sales and the FOMC meeting minutes to decide the next steps on the day.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>The firm says that UK inflation is expected to accelerate further in the months ahead unless the government steps in with fresh measures to lower prices, noting that:</p><p style=““ class=“text-align-justify“>“In our view, the composition reaffirms the risk of more sustained domestic inflation. In the absence of offsetting support, we expect CPI inflation to accelerate to over 15% in Q1-23.“</p><p style=““ class=“text-align-justify“>They previously forecast UK inflation to peak at just below 12%, so this is a revision higher to that. Meanwhile, Citi has also revised up its expectations for BOE rate hikes, forecasting that the central bank would hike by another 125 bps to 3.00% by the end of this year – as opposed to their previous forecast of a 50 bps rate hike for the remainder of 2022.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>Equities are looking more subdued on the day and that seems to be weighing on commodity currencies, particularly the antipodeans. <a target=“_blank“ href=“https://www.forexlive.com/news/kiwi-fails-to-find-comfort-from-hawkish-rbnz-20220817/“ target=“_blank“>The kiwi couldn’t even find much comfort</a> from a more hawkish RBNZ with NZD/USD now down 0.8% to 0.6295 on the day.</p><p style=““ class=“text-align-justify“>Perhaps a plunge in commodity prices (iron ore being one of that) is also to blame but the negative risk sentiment on the day sure isn’t helping. US futures are trading at the lows now, with S&P 500 futures down 31 points, or 0.7%, at the moment. Nasdaq futures are down 0.8% and Dow futures down 0.6%, while European indices shrugged off the light gains earlier to keep lower.</p><p style=““ class=“text-align-justify“>For the S&P 500, the retreat in futures could be in part a technical play as the cash market reached a critical juncture in trading yesterday. Of note, we saw buyers run up to test the 200-day moving average (blue line):</p><p style=““ class=“text-align-justify“>I’ve mentioned since the start of the week that there was some scope for gains in equities up until the key resistance point and now here we are. The question now is, can buyers turn things around and pull towards a retest of the key level? Or will we see a rejection and the start of a renewed downtrend as recession worries start to dominate broader markets?</p><p style=““ class=“text-align-justify“>I reckon we might also have to take a cue from the bond market and so far, there isn’t much firm direction just yet. So, let’s see if the US retail sales data and FOMC meeting minutes later today could provide any catalysts for a more meaningful move. If not, this could be where the latest rebound in equities perhaps look to take a pause.</p>

This article was written by Justin Low at www.forexlive.com.

<ul><li>Prior +0.2%</li><li>Market index 273.3 vs 279.8 prior</li><li>Purchase index 203.8 vs 205.4 prior</li><li>Refinancing index 627.1 vs 662.9 prior</li><li>30-year mortgage rate 5.45% vs 5.47%</li></ul><p style=““ class=“text-align-justify“>It’s quite remarkable that what the data is saying and what markets are deciphering is totally different from the narrative that is being put out by the housing industry. Adam put it nicely in a post yesterday <a target=“_blank“ href=“https://www.forexlive.com/news/the-divergence-of-opinion-on-us-housing-between-markets-and-industry-is-180-degrees-20220816/“ target=“_blank“>here</a>. The readings above continue to show a collapse in mortgage activity as both purchases and refinancing continue to decline sharply.</p>

This article was written by Justin Low at www.forexlive.com.

<p class=“MsoNormal text-align-start“>Impeccably organized by Ultimate Fintech, iFX EXPO gathers more traction with every edition. Held annually since 2012 in financial hubs across Europe, Asia, and the Middle East, it is the largest financial B2B exhibition and a hot spot for thought-provoking debate. The upcoming edition, <a target=“_blank“ href=“https://bangkok2022.ifxexpo.com/“ target=“_blank“>iFX EXPO Asia</a>, will take place between 13 and 15 September 2022 at Centara Grand & Bangkok Convention Centre at CentralWorld and is set to be the largest so far.</p><p class=“MsoNormal“>The organizers are planning 2+ days of unparallel networking with industry leaders and decision makers that are coming to Bangkok from all over the world. The event is not only the ultimate destination for financial industry leaders to network and showcase their products, services and brands, but it also exceeds expectations with its exclusive parties. They allow attendees to catch up with existing and potential partners in an informal setting. </p><p class=“MsoNormal text-align-start“>The agenda is filled with insightful topics and renowned experts. Keynotes include high-calibre speakers from market-leading companies in the forex and fintech space, such as Finnovation Labs, Equity Group, Finalto Asia, one-Zero, ATFX Southeast Asia, Brokeree Solutions, and others. To find out more information on the topics and keynotes, view the <a target=“_blank“ href=“https://bangkok2022.ifxexpo.com/discuss/“ target=“_blank“>Agenda</a>. </p><p class=“MsoNormal text-align-start“>Zulu Trade tops the event’s impressive list of sponsors as the Official Global Partner, followed by numerous other forward-thinking brands, including ATFX, AximTrade, Finalto, TMGM, B2Broker, Equity Capital, and B2BinPay, to only name a few. An impressive list of proud sponsors and exhibitors of iFX EXPO Asia 2022 can be explored on the <a target=“_blank“ href=“https://bangkok2022.ifxexpo.com/meet/#sponsors“ target=“_blank“>official website</a>.</p><p class=“MsoNormal text-align-start“>Who Will Attend?</p><p class=“MsoNormal“>iFX EXPO Asia is a perfect place for global fintech collaboration. The event brings together top-level executives from most prominent international companies. Attendees include:</p><p class=“MsoListParagraph“>· Technology & Service Providers</p><p class=“MsoListParagraph“>· Digital Assets & Blockchain </p><p class=“MsoListParagraph“>· Retail & Institutional Brokers</p><p class=“MsoListParagraph“>· Payments, Banks & Liquidity Providers</p><p class=“MsoListParagraph“>· Affiliates & IBs</p><p class=“MsoListParagraph“>· Regulation & Compliance</p><p class=“MsoListParagraph text-align-start vertical-align-baseline“>Register Now and Benefit from the Free Pass </p><p class=“MsoNormal text-align-start“>You can register now to get your Free Pass for iFX EXPO Asia 2022 following the registration <a target=“_blank“ href=“https://bangkok2022.ifxexpo.com/register/“ target=“_blank“>link</a>.</p><p class=“MsoNormal“>The Pass grants unrestricted access to 2+ days of unlimited networking opportunities, including free admission to the Speaker Hall and Idea Hub, Sponsored Food & Beverages Areas, and the exclusive Welcome and Night Party events.</p><p class=“MsoNormal text-align-start“>Take Advantage of an Exclusive Accommodation Offer</p><p class=“MsoNormal text-align-start“>Centara Grand at CentralWorld has been selected as the official accommodation provider for iFX EXPO Asia 2022, offering exclusive rates for all event delegates between 10and 17September. To benefit from the special offer, book your stay <a target=“_blank“ href=“https://www.centarahotelsresorts.com/centaragrand/cgcw/ifx-expo-asia-2022?abcd“ target=“_blank“>here</a> in advance.</p><p class=“MsoNormal“>There is less than a month to go until the show, so don’t miss out and Register NOW!</p>

This article was written by ForexLive at www.forexlive.com.

<p style=““ class=“text-align-justify“>The simplified take on the oil market now is that the bulls have gotten less bullish amid the recent price action but are staying firm that the fundamental outlook for prices is that it favours a move higher, <a target=“_blank“ href=“https://www.forexlive.com/news/the-data-thats-driving-the-rout-in-oil-prices-is-barely-believable-20220804/“ target=“_blank“>despite what the data might say</a>. But as much as the optimism is retained, the technicals are something that should not be ignored either.</p><p style=““ class=“text-align-justify“>The drop in oil back below $95 and more crucially its 200-day moving average (blue line) has been a major blow to the bullish sentiment that has prevailed since the end of last year.</p><p style=““ class=“text-align-justify“>Right now, the critical level to watch is the $88 mark as buyers are hanging on in there close to the 61.8 Fib retracement level at $88.04. That remains the key support level to eye on the daily chart. If buyers can convince of a push back above $95 or the 200-day moving average, then there is scope for a further rebound towards $100 next. However, break below $88 and we could see a quick fall back towards $80 next.</p>

This article was written by Justin Low at www.forexlive.com.

<p style=““ class=“text-align-justify“>The dollar is in charge once again in trading today as traders continue to weigh up recession risks and the Fed outlook in general. The latter was in focus last week amid the slightly softer US CPI data but we have seen the reaction completely faded now as the greenback takes charge again.</p><p style=““ class=“text-align-justify“>As is the case, it seems like the bond market is right once again and FX is following suit as such. The dollar has completed a round lap against the euro in a drop from its 61.8 Fib retracement level at 1.0361 to 1.0130 currently. The latest retreat is a massive blow for the euro as it targeted a breakout, and it exemplifies how bad sentiment is for the single currency.</p><p style=““ class=“text-align-justify“>It’s tough to find any reason whatsoever to like the euro as the economic outlook remains rather dire. At this stage, the ECB has still only delivered a 50 bps rate hike and already it seems like their window to deliver another is closing.</p><p style=““ class=“text-align-justify“>The euro area economy looks to have deteriorated sharply in July and with a looming energy crisis set to befall the region in the winter months, it’s hard to be optimistic towards the end of the year.</p><p style=““ class=“text-align-justify“>Looking at EUR/USD, the next key level to watch will be the short-term support near 1.0100 and if that gives way, parity beckons once more for the pair. And this time, it may not be just a flash in the pan drop below the key psychological level.</p>

This article was written by Justin Low at www.forexlive.com.

<ul><li>Prior -45.8</li><li>Economic sentiment -55.3</li><li>Prior -53.8</li></ul><p style=““ class=“text-align-justify“>That’s another dismal reading as ZEW notes that they expect a further decline in the already weak economic growth in Germany. Adding that high inflation rates and expected additional costs from higher energy prices are to decrease profit expectations for the private consumption sector.</p>

This article was written by Justin Low at www.forexlive.com.