Morning Brew September 14 2022
Senior Relationship Manager
Summary: Risk Off inflation NOT topping
A Higher than feared CPI sparked US Rates to jump higher to above 3.4% and caused risk aversion across the board. The USD Index jumped to near 110 again and Equities sold off. Core Inflation rose 6.3% from 5.9% in July showing more persistence than hoped.
US Indexes suffered the biggest loss in 2 years with the Nasdaq down more than 5% and the Dow and S&P near 4%, the GHER40 fell from above 13400 to now 13085.
GBPUSD dropped to 1.15 and EURUS fell to below parity again, USDJPY rose to 143.90. Bitcoin is at 20300 again. Gold dropped to 1702 and Silver is at 19.30.
There is now a 63% probability of a 0.75% hike and the remaining 37% are in favor of a 1% hike – no longer 0.5%. that is the cause of market the market turmoil.
The PPI today at 14:30 will be closely watched for a confirmation that the measures so far cannot control inflation. Ex Food and energy s expected at 7.1% and the PPI Final demand at 8.8%.
UK Cpi came just below 10% versus an expectation of just above.
The Bank of Japan is preparing for an intervention in the FX markets acc to Reuters, the news pushed the rate from testing 145 more than 100 pips lower.
Google is the center of a European court ruling where a 4.4 bio fine is at stake.
Be on the high alert for still exceedingly nervous markets.
Physically Settled Futures:
US Dollar Index - Sep 2022 (DXU2) will expire 16th Sep at 9:00 GMT
GBPUSD - Sep 2022 (BPU2), E-mini EURUSD - Sep 2022 (E7U2), EURUSD - Sep 2022 (ECU2), JPYUSD - Sep 2022 (JYU2), E-micro EURUSD - Sep 2022 (M6EU2), NZDUSD - Sep 2022 (NEU2), EURCHF - Sep 2022 (RFU2), EURGBP - Sep 2022 (RPU2), EURJPY - Sep 2022 (RYU2), SEKUSD - Sep 2022 (SEU2), CHFUSD - Sep 2022 (SFU2) will expire 16th Sep 15:00 GMT
GER50MIDSEP22 will expire 14th Sep at 8:00 GMT
AUDUSDADSEP22, EURCHFRFSEP22, EURJPYRYSEP22, EURUSDECSEP22, GBPUSDBPSEP22 will expire 14th Sep at 15:00 GMT
USDINDEXSEP22 will expire 15th Sep at 15:00 GMT
US2000SEP22 will expire 16th Sep 8:00 GMT
OILUSOCT22 will expire 16th Sep 15:00 GMT
Futures can be rolled online via the Futures Spread Trade Ticket. Any open positions will be closed after the mentioned times.
US: PPI (Aug)
Japan: Core machine orders (Jul)
UK: CPI (Aug)
UK: RPI (Aug)
UK: PPI (Aug)
Eurozone: Industrial production (Jul)
India: WPI (Aug)
New Zealand: Current account balance (Q2)
Hong Kong: Industrial production (Q2)
Hong Kong: PPI (Q2)
Thursday, Sep 15
US: Jobless claims (weekly)
US: Retail sales (Aug)
US: Philly Fed manufacturing survey (Sep)
US: Empire State manufacturing survey (Sep)
US: Industrial production (Aug)
US: Business inventories (Jul)
Japan: Trade data (Aug)
Japan: Tertiary industry activity index (Jul)
Australia: Unemployment rate (Aug)
UK: Bank of England decision (Sep)
Eurozone: ECB’s Centeno speaks
Indonesia: Trade data
New Zealand: Real GDP (Q2)