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Financial markets are anxiously awaiting data on Chinese inflation during the Asian session, details on New Zealand’s electronic card retail sales, and expectations for the third quarter’s inflation rate from the Reserve Bank of New Zealand.
Among the upcoming figures for Japan are machine tool orders for July. Due to lower than anticipated Chinese trade statistics and the rating of US banks by Moody’s, markets have become wary. In Italy, the unanticipated windfall tax on bank profits has also hampered the spirit of taking chances. The first round of Treasury auctions after the announcement of the quarterly refunding went smoothly, with strong supply in the 52-week bill and 3-year note auctions.
Economic Data
On Wednesday, the US will sell 10-year notes as US Treasury yields decrease. The July CPI data, which is coming on Thursday, is the subject of much attention. Following the unexpectedly poor trade figures, China will release its July inflation report on Wednesday. The Consumer Price Index is anticipated to drop by 0.4% from a year ago, while the Producer Price Index is anticipated to drop by 4.1%.
Key Developments
The Euro was negatively impacted by the news of Italy’s bank tax, with the EUR/USD falling to a low of 1.0927 before rising to 1.0960. The US session saw some recovery in the GBP/USD exchange rate, and Friday will bring important UK GDP statistics.
Despite declining government bond yields and sensitivity to risk, the USD/JPY increased, signalling a stronger US Dollar. Japan will release July’s machine tool orders data, and the USD/CAD increased, rising above 1.3500. Concerns about China’s economic development impacted on the Australian and New Zealand dollar, with NZD/USD hitting a low of 0.6033 and then rising to 0.6060.
WTI fell below $80.00 during the afternoon before bouncing back and moving back up to the $83.00 region. Crude oil prices remained erratic during the session. Silver continues to fall and dropped below $23.00, while gold hit its lowest close in a month at $1,924.
Also Read:
GBP/USD falls on global economic growth woes
UK companies face challenges in Eurozone
How could stocks, bitcoin react to potential uptick of US inflation?
Chinese demand-linked concerns dragging WTI’s price down
Fed’s Harker expects cutting rates sometime next year
