Here
are the links to the weekly roundups, reviews and also previews of the
beginning week.
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LAST WEEK
VIXtermination Sparks Buying-Panic In
Stocks As Yield Curve Crashes To 10 Year Lows
Funds
Suffer Overall Net Outflows Driven by Money Market Funds
NEXT WEEK
The EURUSD reacts to news in a very
selective way as of late. The relevance of news depends on what it tells us
about future central bank policy. The new rate indications (“dots”) of FOMC
members raise speculation of a December rate hike.
Hurricane season Hurricane Harvey hit the Gulf Coast of Texas in late August, followed by Irma (Florida) while the trajectory of Maria (beyond Puerto Rico) remains uncertain. As outlined this week by the Fed, “storm-related disruptions and rebuilding […] affect economic activity in the near term, but […] are unlikely to materially alter the course of the national economy over the medium term”. This means that the Fed will mostly disregard late summer data, including plunging industrial production and rebounding prices.
The
next ten days will provide an interesting mix of politics and economics. Voting
polls are open in Germany and possibly a week later in Catalonia. The hunt for
higher inflation continues both in the US and Euro area.
German
elections and IFO index * EZ inflation and money supply * US PCE inflation *
Brexit negotiations and Chinese PMIs
Risk premiums across asset classes are
currently at pre-Lehman Brothers lows * High GDP growth relative to short-term
interest rates supports low risk premiums * As US interest rates rise towards
the natural rate, financial volatility and risk premiums should rise * This
could play out in Q4.
Canada: Know Your Audience * US: Will The
Fed’s Preferred Inflation Gauge Follow CPI? *
Asia — Is The RBNZ A Test Case For
Political Interference? * Europe: Premature To Sound The All-Clear * Latin
America: Mexican Monetary Policy
Approaching A Turning Point
Low Inflation May Suppress Bond Returns
How
far can this go? * Confidence indices for the manufacturing sector continue to
rise * This is corroborated by trade data in Asia * Fed sticking to its guns,
but the inflation conundrum remains
Macro Comment – Marc
Chandler
Old
and New Drivers in the Week Ahead
FX weekly: Is 1.20
the new 1.15?
– Nordea
Every
time EUR/USD has traded at 1.20, we get a leak or a comment from the ECB. Even
though this is possibly coincidental it can affect market psychology. Also;
next week markets will have to digest at least one more round of Trump vs.
Rocket Man.