August 2019 - Page 11 of 29 - Financial Occultist

A light one on the data docket once again

Good day, everyone! Hope you’re all doing well as we get things going in the session ahead. There hasn’t been much major movement on the day so far but the yen is a little weaker amid higher Treasury yields this time around today.

The back and forth action in bonds this week is largely to do with positioning as all eyes are on the Fed and the Jackson Hole symposium later in the week.

Looking ahead, there isn’t much else to shake things up so just be on the look out for trade and Brexit developments. Otherwise, risk sentiment will remain a key factor and as such, keep your eyes on the bond market.

0830 GMT – UK July public sector debt data

Prior release can be found here. A glimpse of the UK budget and public finances but it isn’t a major data point at this point in time.

1100 GMT – US MBA mortgage applications w.e. 16 August

Weekly US housing data, measures the change in number of applications for mortgages backed by the MBA during the week. Not the biggest of data points, but a general indicator of the housing sector sentiment.

“Whenever we are faced with a serious business decision, the answer is almost always to increase quality”

21-Aug-19 06:00 am

Anirudh Sethi

MSCI china index announcement just about top ticked flows

21-Aug-19 05:39 am

Analysis

Anirudh Sethi

Here’s a call for a September and December Federal Reserve rate cut

21-Aug-19 05:39 am

Analysis

Anirudh Sethi

Not waiting for Fed Chair Powell to speak at Jackson Hole (Friday 23rd August at 1400 GMT) Standard Chartered with a call on what to expect from the FOMC:

Fed funds target rate

adding a 25bps cut in September (we expect two dissents again)
We continue to forecast a cut in December, as well

Stan Chart citing:

heightened trade uncertainty
ongoing deterioration in global growth

US economic fundamentals remain solid, for now

strong labour market and consumer spending
However, both coincident and leading indicators from the goods sector have been deteriorating.”

“Core inflation remains below the FOMC’s medium-term 2% objective…

we expect the policy stance to remain dovish until either trade and growth concerns abate, core inflation tops 2% or wage growth tops 3.5% y/y, roughly the latest cycle’s peak.”

Trump says he would love to reduce capital gains taxes

21-Aug-19 05:18 am

Analysis

Anirudh Sethi

Tough to imagine he could do it

Now that Democrats have the House it’s going to be tough to do anything substantial, or anything Republicans in the Senate would support. There’s some talk that the White House will try to index capital gains to inflation via executive order or technical changes but it’s tough to believe that would fly. In any case, it’s not going to give a jolt to the economy and awaken sluggish business investment.