FX Highlights

  • USD is trading lower in reaction to report of a sharp rise in EU manufacturing and services PMI's, stronger equity markets and a rise in crude prices above $74 a barrel, commodity currencies supported by rising crude and stronger equity markets
  • Focus turns to today's release of existing home sales and Bernanke's speech in Jackson Hole Wyoming, Bernanke may address the issue of an exit strategy and timing of an exit strategy from quantitative ease along with his outlook on the global recovery
  • Nikkei reports that Japan's DPJ opposition party may win more than 300 lower house seats in the August 30th elections, JPY higher supported by the safe haven flows on news that China's bank loans will be audited by the government
  • EU August services PMI rises to 49.5 compared to 45.7 last month, manufacturing PMI rises to 47.9 from 46.3 last month, EUR higher
  • UK Chancellor Darling is cautious on UK recovery, GBP supported by positive EU PMI data
  • US commercial paper market expanded last week for only the second time since April rising by 35.8 bln in the week ending August 19th, this may be a sign the economy is growing
  • MBA says the percentage of mortgages in foreclosure or with at least one payment past due hit a record 13.16% in Q2, this could be more trouble for US banks
  • Wall Street Journal reports that US banks are entering a new face of the financial crisis as more banks fail, regulators plan to seize Guarantee Financial
  • US equity markets set to open higher, European equities 1% higher, Nikkei closed 145 points lower

Upcoming Events

  • US- Friday, July existing home sales will be released expected at 490k compared to 489k last month
  • CAN- Friday, no major data is due for release