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Erik Schafhauser Zürich Erik Schafhauser Zürich Erik Schafhauser Zürich

Morning Brew 05 August 2021

Morning Brew 1 minute to read
Erik
Erik Schafhauser

Senior Relationship Manager

Summary:  Looking for Narrative

Good Morning

An interesting day in FX yesterday where the USD fist gave up ground – trading as low as 91.80 then fairly hawkish comments by Richard Calida caused a reversal. Gold and Silber tested the upper end of their trading range at 1831 and 26. EURUSD was within reach of the 1.1900. US 10 Year yields fell to below 1.15%before rising to 1.2% again.

Federal Reserve Vice Chair Richard Clarida  stated "Commencing policy normalization in 2023 would, under these conditions, be entirely consistent with our new flexible average inflation targeting framework,"

Equities remained fairly strong despite Clarinda’s remarks and closed only slightly off the previous day. GM and ford weighed on blue chips. Both car makers declined, GM 8.9% and Ford by 5%. The Dow lost  0.92%, the S&P 500 lost 0.46%, and the Nasdaq gained 0.13%. Dax keeps trying to breach the 15700 but is failing so far.

Robin Hoods Options started trading and the stock temporarily rose to 85 after the IPO at 38.

The US reports 100k new corona infections, the highest number in 6 Months

Reuters released a poll of FX strategists, 63% state they are not confident that the USD will weaken in the next 12 months, and 57% expect volatility to increase

What to watch out for today? The Bank of England at 13:00 CET, no change in rates is expected but any comments on the asset purchase program will be of significance. In the US the initial Jobless claims at 14:30 CET give a little indication on the nonfarm payroll. With the delta variant on the rise, we could be seeing additional corona measures internationally.

On a hawkish statement by the BoE, Cable could rise above the 1.3900 with1.3925 and 1.3960

Citi stated yesterday a 10% equity market decline was very plausible, that will lead to some discussions.

Market participants seem to be al little on edge as we say yesterday in the FX moves, trade carefully.

Local Start Date

Local Time

Country/Region

Indicator Name

Period

Reuters Poll

Unit

5 Aug 2021

08:00

Germany

Industrial Orders MM

Jun

1.5%

Percent

5 Aug 2021

13:00

United Kingdom

BOE Bank Rate

Aug

0.10%

Percent

5 Aug 2021

13:00

United Kingdom

GB BOE QE Corp

Aug

20B

GBP

5 Aug 2021

14:30

United States

International Trade $

Jun

-73.9B

USD

5 Aug 2021

14:30

United States

Initial Jobless Clm

31 Jul, w/e

380k

Person

5 Aug 2021

14:30

Canada

Trade Balance C$

Jun

-0.80B

CAD

6 Aug 2021

05:00

New Zealand

Reserve Assets Total

Jul

NZD

6 Aug 2021

08:00

Germany

Industrial Output MM

Jun

0.5%

Percent

6 Aug 2021

08:00

United Kingdom

Halifax House Prices MM

Jul

Percent

6 Aug 2021

08:00

Norway

Reserve Assets Total

Jul

NOK

6 Aug 2021

08:45

France

Reserve Assets Total

Jul

EUR

6 Aug 2021

09:00

Switzerland

Forex Reserves CHF

Jul

CHF

6 Aug 2021

14:30

United States

Non-Farm Payrolls

Jul

900k

Person

6 Aug 2021

14:30

United States

Unemployment Rate

Jul

5.7%

Percent

6 Aug 2021

14:30

United States

Average Earnings YY

Jul

3.9%

Percent

6 Aug 2021

14:30

Canada

Employment Change

Jul

150.0k

Person

6 Aug 2021

14:30

Canada

Unemployment Rate

Jul

7.4%

Percent

7 Aug 2021

China (Mainland)

Exports YY

Jul

Percent

7 Aug 2021

China (Mainland)

Imports YY

Jul

Percent

7 Aug 2021

China (Mainland)

Trade Balance USD

Jul

USD

9 Aug 2021

03:30

China (Mainland)

PPI YY

Jul

Percent

9 Aug 2021

03:30

China (Mainland)

CPI YY

Jul

Percent

(Refinitiv)

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