FX Highlights

  • USD is trading mixed and JPY lower as equity markets rebound and the price of crude rises, Home Depot posted better-than expected earnings, Goldman Sachs Cohen says the recession in the US is ending, EUR supported by a sharp rise in German economic sentiment with gains limited by ZEW statement that EU recovery will be gradual, UK inflation rises more than expected and GBP rallies, RBA minutes hawkish, JPY lower tracking stocks
  • Focus turns to today's release of US PPI and housing starts
  • Bloomberg reports that Goldman Sachs says the recession is ending
  • JPY lower as equities rebound, election polls show the opposition Democratic Party likely to win the Japanese national election on August 30th and this would mark the first power change in fifty years
  • RBA minutes for the August 4th policy meeting state that further rate cuts are unlikely and inflation will not fall as much as previously expected, AUD marginally higher
  • UK July CPI rises by 1.8%, a 1.5% rise was expected, the CPI report reduces risk of UK deflation, GBP higher
  • German August ZEW index improves 56.1 compared to 39.5 last month, this was highest level for German investor confidence in three years, ZEW official says German recovery to be gradual, EUR flat
  • Three-month USD and sterling rates at new record low
  • US equity markets set to open higher, European equities 1% higher, Nikkei closed 16 points higher

Upcoming Events

  • US- Tuesday, July housing starts will be released expected to rise by 600k compared to 582k last month with July building permits expected to rise to 580k from 563k last month along with July PPI expected to fall 0.2%
  • CAN- Tuesday, no major economic reports are scheduled for release