Archives of “September 2019” month

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Currencies in focus after weak PMI’s

  
Analysis, Forex
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Quick look as PMI impact settles

The weak PMI data was not a surprise, but the flow through into service data is confirmation of the feared inevitable, hence the weakness we see in the EUR/USD, German Bonds rising and European equities down. Dax now increasing its losses and at -1.48%.
So, the strongest currencies include the JPY and CHF (on risk aversion) with the EURO and the GBP the weakest on the session. Watch out for further risk souring.
Quick look as PMI impact settles

Eurozone September manufacturing PMI’s 45.6 vs 47.3 expected

  
Analysis, Economy

Latest data release by Markit

Graph
  • Prior 47.0
  • Services PMI 52.0  vs 53.3  expected
  • Prior 53.5
  • Composite PMI 50.4  vs 52.0 expected
  • Prior 51.9

Eurozone figures reflecting the weaker German and French PMI’s out earlier. Another weak set of eurodata and global trade concerns are continuing to drag down the zone. Calls for fiscal stimulus from the ECB likely to grow.

David Rosenberg forecasts a US economic recession is less than 12 months away

  
  Analysis

n ICYMI from Gluskin Sheff chief economist and strategist says the Federal Reserve’s FOMC will cut rates in October and December

  •  and through 2020
  • “The economy is already slowing down”
  • “Earnings are actually contracting”
  • “There’s a recession coming in the next 12 months”
Report via CNBC
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Rosenberg was a permabear for a long time but switched sides to much protest from his fan base.
Back in the bear camp.

German media report that USD will be 50% backing for Facebook crypto Libra

  
  Analysis
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Weekend report in Reuters on the cryptocurrency, citing Speigel

US dollar will make up 50 percent of the basket of currencies backing Facebook’s planned digital coin Libra
euro, yen, sterling and Singapore dollar comprising the rest
yuan will not be included
Exclusion of yuan “could help smooth the planned cryptocurrency’s path in the United States” says Reuters
More:
  • US dollar would make up 50 percent of the basket
  • euro with 18 percent
  • yen with 14 percent
  • GBP 11 percent
  • SGD 7 percent
While we are at it, BTC update:
Weekend report in Reuters on the cryptocurrency, citing Speigel

Oil – more on the Aramco repairs story (could take months, not weeks)

  
Analysis, Crude
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You know how it is, your car is making a funny noise so you take it to the mechanic.

“Yeah, leave it with me, shouldn’t take long”
 
The  you get the phone call, right?
“Yeah …. this looks nasty ….”.
Same with this:
  • Oil – Aramco says repairs to Saudi plant could take many months rather than weeks
WSJ has more on it now:
  • It may take many months-rather than the maximum 10 weeks company executives have promised-to restore operations to full working order,
Journal is gated, here is the link if you can access it.

Weekend – ex-PBOC head says unprecedented challenges due to trade war

  
  Analysis

Zhou Xiaochuan, a former governor of the pbocc  People’s Bank of China speaking over the weekend

existing global monetary and financial order is facing daunting and unprecedented challenges
due to regional and global trade disputes
normal functioning of the international monetary and financial system has been “disrupted by financial sanctions and other measures contrary to market rules”
“Trade disputes are seriously threatening global trade and economic growth,”
Zhou was speaking in Singapore, report via Caixin
Market moving news re trade from Friday ICYMI:
  • China cancelled a planned agricultural trip to Montana, raising questions on trade
Zhou Xiaochuan, a former governor of the pbocc  People's Bank of China speaking over the weekend 

Oil – Aramco says repairs to Saudi plant could take many months rather than weeks

  
Analysis, Crude
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DJ with the report on a more pessimistic outlook for repair time compared to what the market was led to believe last week.

Oil traders might like to take note, should be a bullish input (compared to otherwise)
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