July 2020 - Page 12 of 46 - Financial Occultist

Comments by the Chinese foreign ministry

Current situation is something China does not want to see
Urges the US to revoke its ‘wrong’ decision
Calls for US to create necessary conditions for return of bilateral relations

Some accompanying remarks to their decision to call for the US to shut its consulate in Chengdu. Risk trades saw a slight dip on the headline but barring any further escalation by the US, the narrative here will quickly grow a little stale.

For now, it is still creating some sense of nervousness following the selloff in US stocks overnight – not to mention the decline in Chinese equities today.

AUD/USD is down to session lows of 0.7083, and testing waters under its 100-hour moving average at 0.7090. Keep below that and the near-term bias turns more neutral.

Major tech companies have increased their capitalization by more than $ 1.7 trillion this year.

24-Jul-20 07:45 am

Analysis

Anirudh Sethi

More on that EUR/USD forecasts raised …. to 1.12! (not a typo)

24-Jul-20 06:24 am

Anirudh Sethi

Bank of America Global Research discusses EUR/USD outlook and now targets the pair at 1.12 in Q3 and 1.08 by year-end.

“EURUSD is close to its high for the year. We remain sceptical. The market is long EURUSD and this position could be at risk, particularly for real money. We expect a weak recovery of the global economy during re-opening and don‘t see full normalization as long as the virus is a threat. The EU Recovery Fund is a positive step, but far from a game changer in our view, an 1-off increase in the EU budget that allows the EU to catch up to the fiscal stimulus other G10 economies have been doing–with the US doing more. Although the US recovery may slow in the months ahead, we do not expect another shutdown,” BofA notes.

“As the market has moved in a different direction from our forecasts, we update our forecasts, marking to market. We now expect EURUSD at 1.12 in Q3 from 1.08 before and 1.08 in Q4 from 1.05 before. We keep our 2021 EURUSD forecast at 1.15.We therefore retain a bearish EURUSD bias, to a large extent because of our positive USD view, which in turn is based on a bearish outlook for the global economy,” BofA adds.

I posted earlier on BoA and their EUR forecast out to year end:

CME raises Comex 5000 silver futures (SI) margins by 12.5%

24-Jul-20 06:21 am

Analysis

Anirudh Sethi

Given the lift in volatility this is no surprise.

SI margins +12.5% to $9,000 per contract

prior $8,000

for July

For oil, Nymex CL maintenance margins lowered to $6,200 (from 6,800) for Sept.

China says can expel hundreds of US “diplomats” who actually worked for CIA in Chinese mainland

24-Jul-20 06:19 am

Anirudh Sethi

Via the Global Times: China can consider targeted strike to retaliate the US on the forced closure of the consulate in Houston

expelling hundreds or even more US “diplomats” who actually worked for CIA in Chinese mainland and Hong Kong

GT citing a research fellow at the Chinese Academy of Social Sciences in Beijing

Article is here

Via the Global Times: China can consider targeted strike to retaliate the US on the forced closure of the consulate in Houston

FT report “US stimulus delays as Republican talks fall into disarray”

24-Jul-20 06:17 am

Analysis

Anirudh Sethi

The ongoing bickering and war of words in the Republican senate has delayed any action on further stimulus.

This earlier – they won’t even get a rough outline until next week let alone any action:

US Senate leader McConnell says will introduce ‘framework’ for recovery bill “early next week”

Financial Times have a report up on the delays, link is here (may be gated)

Mitch McConnell, the Republican Senate majority leader, had been expected to announce the party’s stimulus proposal on Thursday morning, only to reverse course later in the day and announce the plan would not come until next week.

Getting the stimulus done is in Republican interest, any support for the economy will be welcomed by Trump’s re-election campaign.

The ongoing bickering and war of words in the Republican senate has delayed any action on further stimulus.

US Sec State Pompeo says China threat to economy, liberty

24-Jul-20 06:09 am

Anirudh Sethi

Title is “Communist China and the Free World’s Future”

Pompeo is unleashing on China

China military growing stronger, more menacing
China filed to halt spread of coronavirus
Free world must triumph over this new tyranny
Must distrust China
- Xi is a true believer in bankrupt totalitarian ideology
- China using “slave labour”
- Huawei a true national security threat
- Chinese consulate in Houston was a hub of spying and IP theft
- Chinese people distinct from the Chinese Communist Party – must engage with the people
- Communists always lie
- CCP fears the Chinese peoples’ opinions
- its time for free nations to act to protect their own economic prosperity, its ideals from the tentacles of the CCP
- “The old paradigm of blind engagement with China has failed. We must not continue it. We must not return to it.”