Major FX was characterised by higher yen crosses during the opening session of the week. USD/JPY tested its Friday high circa 135.50 but did not manage to follow through up further. Meanwhile AUD, NZD rose against the USD. EUR, CAD and GBP are little changed on the session, as is CHF (all against the USD).

News flow was decent over the weekend.

  • The US Senate passed Biden’s Inflation Reduction Act. It heads to the lower house for passing and then to his desk for signing into law.
  • There appeared to be progress made on agreeing to Iran’s nuclear deal. This has been going on for months and while I say ‘appeared’ there also appears there is still work to be done.
  • China’s July trade data was released over the weekend. Exports grew y/y at their fastest pace for the year.

From the Fed we had two speakers over the weekend, Bowman and Daly. Both flagged further rate hikes. Bowman seems more keen on +75 in September than does Daly, but there is still a good while to come before September 21. Plus 3 inflation readings (see bullets above) and another NFP report.

audyen wrap 08 August 2022