To the scoreboard:
- Dow: 25,509.23 -74.52 (-0.29%)
- S&P500: 2,853.58 -4.12 (-0.14%)
- AUD/USD: 0.7378 -0.0054 (-0.73%)
- ASX SPI futures (September contracts): 6,249 (+10)
1. US dollar strength was the main story overnight. The greenback gained significant ground against all the major pairs including the safe haven Japanese yen, and was also helped by a selloff in Russian and Turkish currencies.
2. The USD index is at 95.60 this morning, at the top end of its recent trading range. The Kiwi fell to a two-year low after yesterday’s dovish interest rates decision and the AUD is under pressure ahead of the RBA’s latest quarterly growth projections (11:30am AEST).
3. Attempts by American and Turkish officials to resolve a number of disputes were unsuccessful and the lira fell to a new record low, down 40% for the year. Meanwhile, the Russian rouble got slammed after the US hit Russia with new sanctions over a March chemical weapons attack.
4. Global stocks were little-changed, as the S&P500 edged lower after Chinese markets shot up by 2.5% yesterday. Benchmark US 10-year bond yields fell by four basis points to 2.93%.
5. Gold held its ground in the face of the stronger USD. It’s at around $US1,212 this morning, still near 18-month lows. Copper and iron ore also rose, while oil prices edged lower following yesterday’s sharp falls. Bitcoin bounced back off its weekly low.
6. Looking ahead, July inflation data in the US will be of key importance tonight. Headline CPI is forecast to come in at 2.9% in annual terms, with the core print at 2.3%.
Here’s the rest of today’s data calendar:
- Japanese Q2 GDP.
- RBA Statement on Monetary Policy.
- Chinese data on loan growth and money supply.
- UK Q2 GDP and industrial production.
- Canadian employment numbers.
Have a great weekend.
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