Market movers today
The FOMC minutes from the meeting earlier in August are due out. As we believe the Fed is on track to deliver two more hikes this year, we are more interested in any discussions on how long to continue shrinking the balance sheet and the future monetary framework.
US existing home sales will give more clues as to whether the US housing market is slowing down. Other housing data has pointed to some weakening in Q2 , as higher mortgage yields and rising house prices have reduced affordability of houses among US households.
The EIA is set publish its weekly oil inventory report today. Yesterday, API reported a 5mb drop in inventories last week.
There are no key movers in the Scandies today.
Selected market news
US President Trump’s former lawyer yesterday pleaded guilty to charges on campaign finance violations among others and furthermore said that Trump had directed Michael Cohen to commit a crime. Furthermore, Trump’s former Campaign Chairman Paul Manafort was convicted on tax and bank fraud charges. The news help set the tone in the market late yesterday and overnight, weighing on risk sentiment and pushing USD lower.
Global trade talks continue to make headlines. This time, there have been unconfirmed reports that the US is planning to announce on Thursday that negotiations with Mexico over a revised NAFTA are finally progressing. This could pave the way further for Canada to re-join the talks. However, Mexico later denied the story. USD/MXN dropped on the news. The US and China are set to resume trade talks in Washington later this week.
Oil prices have recovered some lost ground this week with the price on Brent crude moving firmly back above the USD72/bbl level. The American Petroleum Institute (API) reported yesterday that inventories fell 5mb last week, thus mitigating the impact of the large stock build seen in last week’s data.
UK Foreign Secretary Jeremy Hunt yesterday urged the EU to step up sanctions against Russia, matching the recent response from the US.
