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EUR/USD has posted considerable losses on Tuesday, after showing little movement in thin trade on the Labor Day holiday. Currently, the pair is trading at 1.1563, down 0.49% on the day. In the eurozone, industrial producer prices rose 0.4% in July. In the U.S, today’s key indicator is ISM Manufacturing PMI, which is expected to dip to 57.6 points. On Wednesday, Germany and the eurozone release Services PMI and we’ll also get a look at eurozone retail sales.

Eurozone and German manufacturing PMIs are still pointing to expansion, but there is concern in the markets as the downward trend continued in August. This was particularly evident in Eurozone Final Manufacturing PMI, which lost ground for an eighth straight month. The reading of 54.6, which matched the estimate, marked the lowest level since November 2016. In Germany, Final Manufacturing PMI fell from 56.9 to 55.9. Although this is a respectable reading, it is significantly lower than the readings we saw early in 2018, when the indicator was above the 60-level. German manufacturers remain generally optimistic, but have growing concerns over tariffs which the U.S has slapped on China and the EU.

In December, the ECB plans to wind up its asset-purchase program, which has been in play since March 2015. ECB policymakers have taken pains to provide themselves some wiggle room, saying that the program could be extended if inflation suddenly weakens. Still, the markets expect this stimulus plan to be terminated on schedule. In August, the Bank purchased EUR $29 billion, the lowest level since this stimulus program started. Traditionally, August is a quiet month, with many sellers on holiday.

Notes/Observations

• Concerns linger over emerging market stability and possible contagion effects; USD on firm footing
• Trade war concerns also simmering; President Trump tweeted that a trilateral NAFTA deal with Canada was not necessary and Congress should not "interfere" with trade negotiations
• Tame Swiss inflation data supports the view that the SNB won't raise rates before the ECB
• UK PMI data continues to miss expectations but holds onto growth territory (both Manufacturing and Construction missed consensus the past few sessions)

Asia:

• (AU) Reserve Bank of Australia (RBA) left Cash Rate Target unchanged at 1.50% (as expected). Statement was little changed from prior. Reiterated stance that low rates were supporting the economy and inflation. Progress on unemployment and inflation expected to be gradual. Saw GDP to average slightly higher than 3% in both 2019 and 2020
• South Korea Aug CPI M/M: 0.5% v 0.4%e; Y/Y: 1.4% v 1.4%e ; Core CPI Y/Y: 0.9% v 1.1%; data doesn’t justify any rate hike
• South Korea Q2 Final GDP Q/Q: 0.6% v 0.7%e Y/Y: 2.8% v 2.9%e
• Japan Fin Min Aso stated that the initial budget request for FY19 was likely around ¥102T (as speculated) but was still finalizing figures for budget;

Europe:

• ECB Weidmann (Germany) said the digital revolution only has a small impact on inflation. Concerns technology had depressed prices by raising competition
• UK Chancellor of the Exchequer Hammond (Fin Min) may unveil the budget by as early as Oct in order avoid clashing with the final stages of Brexit talks. No final decision has been made and article noted that the release of the budget could take place later, potentially in December
• Italy Fin Min Tria reiterated the government is seeking to keep its 2019 budget deficit below 2% of GDP
• UK Aug BRC Sales LFL Y/Y: 0.2% v 0.5% prior

Americas:

• President Trump tweeted: President Bashar al-Assad of Syria must not recklessly attack Idlib Province. The Russians and Iranians would be making a grave humanitarian mistake to take part in this potential human tragedy. Hundreds of thousands of people could be killed. Don’t let that happen!

Energy:

• National Hurricane Center issued a hurricane warning for parts of the Gulf Coast where Storm Gordon is expected to hit late Tuesday

Economic Data:

• (ES) Spain Aug Net Unemployment M/M: +47.0K v -27.1K prior
• (CZ) Czech Q2 Average Real Monthly Wage Y/Y: 6.2% v 5.9%e
• (CH) Swiss Aug CPI M/M: 0.0% v 0.0%e; Y/Y: 1.2% v 1.2%e v 1.2% prior
• (CH) Swiss Aug CPI EU Harmonized M/M: 0.0% v 0.4% prior; Y/Y: 1.3% v 1.2% prior
• (SE) Sweden Q2 Current Account (SEK): 10.0B v 17.6B prior
• (BR) Brazil Aug FIPE CPI (Sao Paulo): 0.4% v 0.3%e
• (UK) Aug Construction PMI: 52.9 v 54.9e (5th month of expansion)
• (EU) Euro Zone July PPI M/M: 0.4% v 0.3%e; Y/Y: 4.0% v 3.9%e

Fixed Income Issuance:

• (ID) Indonesia sold total IDR4.8T vs. IDR4.0T target in 6-month Islamic Bills, 2-year, 4-year, 7-year and 15-year Project-based Sukuk
• (ZA) South Africa sold total ZAR2.4B vs. ZAR2.4B indicated in 2031, 2040 and 2044 bonds
• (CH) Switzerland sold CHF387.4 in 3-month Bills; Yield: -0.864% v -0.849% prior

SPEAKERS/FIXED INCOME/FX/COMMODITIES/ERRATUM

Equities

• Indices [Stoxx600 -0.4% at 381.2, FTSE -0.2% 7493, DAX -0.7% at 12259, CAC-40 -0.7% at 5373, IBEX-35 -0.7% at 9380, FTSE MIB +0.2% at 20436, SMI -0.3% at 8980, S&P 500 Futures +0.1%]
• Market Focal Points/Key Themes: European Indices trade mostly lower coming off the morning highs. The FTSE trades little changed after outperformance yesterday ahead of testimony from BoE members in front of the Treasury select committee. WPP declines sharply this morning after missing estimates and mixed guidance; Illiad, Halfords and DS Smith are among companies trading higher following positive earnings. ING trades higher after a settling with the Dutch Authorities for disgorgement; Scor is another gainer after receiving and rejecting an offer from Covea. Looking ahead notable earnings include Conn's and Napco Security.

Movers

• Consumer Discretionary WPP [WPP.UK] -7.1% (Earnings), Halfords [HFD.UK] +5.8% (Earnings)
• Industrials DS Smith [SMDS.UK] +0.5% (Trading update)
• Financials Scor [SCR.FR] +8.3% (Rejects take over bid), ING [INGA.NL] +1.9% (Settlement with Dutch Government)
• Technology Smith Group [SMIN.UK] +1.8% (Board rejects ICU's £2.8B takeover of the British company's medical division)
• Telecom Illiad [ILD.FR] +2.3% (Earnings)
• Healthcare Abivax [ABVX.FR] +11% (Positive trial data)

Speakers

• EU's Barnier said to prefer UK trade deal of Canada plus over PM May's Chequers plan
• Turkey Central Bank: Significant deterioration in general trend of core inflation indicators in Aug. Main driver of August inflation was in basic core goods and energy prices. Rising trend in energy prices to continue in Sept
• Russia Central Bank (CBR) Govr Nabiullina stated that she saw a real discussion on interest rate at the upcoming decision (Friday Sept 14th). inflation picking up faster than expected. Some factors in favor of hike, a lot of factors in favor of holding rate unchanged rather than cut.
• Indonesia Central Bank Gov Warijiyo reiterates to focus on FX stability. Purchased IDR3T of government bonds on Sept 3rd as part of its duel intervention
• Iran President Rouhani: To exert every effort to pump and export oil

Currencies

• USD continued to find some safe-haven flows related to concerns about trade tensions. Over the weekend President Trump tweeted a threat to expel Canada from NAFTA ahead of talks between the two countries this week
• EUR/USD moving back below the 1.16 handle.
• Tame Swiss inflation data supported the view that the SNB won't raise rates before the ECB. USD/CHF higher by 0.4% at 0.9730 area
• GBP/USD was lower for the 5th straight session to probe the lower end of the 1.28 handle as doubts continue to linger on Brexit negotiations. UK PMI data has also come in below expectations the past two sessions (Manufacturing on Monday and Construction earlier today). Focus will be on the BOE Treasury-select testimony where Gov Carney would likely be question on whether he planned to stay on beyond his Jun 2019 term end date.

Fixed Income

• Bund Futures trades at 160.60 down 13 ticks as Italian bond yields tumble as market pessimism over budget recedes. Resistance moves to 161.82 then 163. A downside break of 159.85 sees 158.69 initially.
• Gilt futures trades at 122.60 up 27 ticks as the British pound extends decline ahead of Carney testimony. Continued support at 122.50, with a continued move higher targeting 123.93 then 124.00.
• Tuesday 's liquidity report showed Monday's excess liquidity rose from €T to €1.915T. Use of the marginal lending facility rose from €30M to €44M.
• Corporate issuance saw a refreshing start to September issuance

Looking Ahead

• 05.30 (UK) Weekly John Lewis LFL sales data
• 05:30 (ZA) South Africa Q2 GDP Annualized Q/Q: +0.6%e v -2.2% prior; Y/Y: 1.0%e v 0.8% prior
• 05:30 (AU) RBA Gov Lowe in Perth
• 05:30 (EU) ECB allotment in 7-Day Main Refinancing Tender (MRO)
• 05:30 (HU) Hungary Debt Agency (AKK) to sell in 3-month Bills
• 05:30 (DE) Germany to sell I/L 2030 and 2046 bonds (bundei)
• 05:30 (BE) Belgium Debt Agency (BDA) to sell €1.4-1.8B in 3-month and 6-month Bills
• 06:00 (IE) Ireland July Industrial Production M/M: No est v -8.9% prior; Y/Y: No est v 8.0% prior
• 06:00 (IE) Ireland Aug Unemployment Rate: No est v 5.1% prior
• 06:30 (EU) ESM to sell €2.0B in 3-month bills
• 06:45 (US) Daily Libor Fixing
• 07:00 (BR) Brazil Aug FGV Inflation IGP-DI M/M: 0.8%e v 0.4% prior; Y/Y: 9.2%e v 8.6% prior
• 07:30 (TR) Turkey Aug Effective Exchange Rate (REER): No est v 76.01 prior
• 08:00 (BR) Brazil July Industrial Production M/M: -1.3%e v +13.1% prior; Y/Y: 2.2%e v 3.5% prior
• 08:05 (UK) Baltic Dry Bulk Index
• 08:15 (UK) BOE Gov Carney with members Haldane, Tenreyro and Saunders testify in Parliament
• 08:30 (CA) Canada July MLI Leading Indicator M/M: No est v 0.2% prior
• 09:00 (RU) Russia announces weekly OFZ bond auction (held on Wed)
• 09:00 (EU) Weekly ECB Forex Reserves
• 09:00 (MX) Mexico July Leading Indicators M/M: No est v -0.07 prior
• 09:30 (CA) Canada Aug Manufacturing PMI: No est v 56.9 prior
• 09:30 (NZ) Fonterra Global Dairy Trade Auction
• 09:45 (US) Aug Final Markit Manufacturing PMI: 54.5e v 54.5 prelim
• 10:00 (US) July Construction Spending M/M: +0.4%e v -1.1% prior
• 10:00 (US) Aug ISM Manufacturing: 57.6e v 57.4e v 58.1 prior; Prices Paid: 69.5e v 73.2 prior
• 10:00 (DK) Denmark Aug Foreign Reserves (DKK): No est v 468.1B prior
• 11:30 (US) Treasury to sell 4-Week Bills
• 11:30 (US) Treasury to sell 3-month and 6-month Bills
• 13:00 (NZ) New Zealand Aug QV House Prices Y/Y: No est v 5.1% prior
• 15:00 (AR) Argentina July Industrial Production Y/Y: -5.4%e v -8.1% prior
• 18:00 (CL) Chile Central Bank (BCCH) Interest Rate Decision: Expected to leave Overnight Rate Target unchanged at 2.50%

Copper extends downtrend into fourth straight day, driven lower by fears of deepening trade conflict between the US and China, which could have strong negative impact on global demand and stronger dollar on renewed risk appetite.

Today's extension lower ( the metal was down 1.5% for the day so far) cracked significant supports at $2.6249 (Fibo 61.8% of $2.5510/$2.7445 upleg) and $2.6115 (23 Aug trough / weekly 200SMA), clear break of which would open way towards key support at 2.5510 (15 Aug low, the lowest since mid-June 2017), for full retracement of $2.5510/$2.7445 upleg).

Negative daily / weekly techs continue to support bears, however, strengthening momentum on daily chart could be an obstacle and may delay final push towards $2.5510 target.

Res: 2.6478, 2.6630, 2.6757, 2.6955
Sup: 2.6000, 2.5510, 2.5145, 2.5000

In UK, Philip Rycroft, Permanent Secretary at the Department for Exiting the European Union (DExEU) told the parliament that the plans for no-deal Brexit are "in place". And, "they are at a level of detail which satisfies the team at DEXEU ... we are constantly monitoring those plans to make sure they are kept up to date."

Also Rycroft said there were studies on the economic impact of Prime Minister Theresa May's Chequers plan and "the work is ongoing".

Aussie dead cat bounce?

As widely expected the RBA held the official cash rate steady at record low 1.5%. Nevertheless, the Aussie was better bid after the release of the statement by Governor Philip Lowe. AUD/USD rose to 0.7235 during the Asian session before quickly easing below today's opening price of 0.7214.

Overall, the statement didn't change much as the central bank maintained its positive view on economic growth and is forecasting growth rate a bit above 3% in 2018 and 2019. Similarly, the monetary institution remains worried about the outlook for household consumption as household income has been growing slowly, while debt levels are high. Regarding inflation, Governor Lowe maintained its forecast of 1.75% for 2018. However, inflation should pick-up in 2019 and 2020 (2.25%y/y both). Finally, the labour market outlook remains positive.

In early European session, AUD/USD resumed its debasement following a broad US dollar rally amid persistent trade war worries. The Aussie fell 0.55% to $1.1563, while the dollar index rose 0.38% to 95.50. Just like the past few weeks, geopolitical developments and trade war tensions between the US and China as well as the ongoing negotiation between the US and Canada regarding a revamp of NAFTA will remain the main drivers in the FX market. Local developments as well as domestic economic data will stay on the backburner for now.

Indian economy strong, rupee soft

Asia's fastest growing economy, India, is in good shape. Q2's GDP grew 8.2%, its highest pace since Q1 2015. 2018's GDP could end up rising 7.5%, in line with the Reserve Bank of India forecasts. The Indian economy remains less dependent on external demand for growth. However, weakness in the Indian rupee weighs on the current account balance, with growing import costs and rising oil prices since the beginning of the year.

Depreciating by 12% against the greenback since the beginning of the year and trading above the 70 level, USD/INR is expected to continue its rise. The US Federal Reserve's normalization cycle along with RBI's moderation of its interventions in foreign exchange are pushing the USD/INR up. The monetary policy meeting on 5 October should see a 0.25% interest rate hike. Currently at 71.32, USD/INR is expected to rise, approaching the 71.40 range in the short-term.

RBA left the cash rate unchanged at 1.5% for a 25th consecutive month. Similar to previous meetings, policymakers were upbeat over the growth and the employment outlook, while acknowledging soft wage growth and inflation. In short, the central bank is optimistic over the business conditions and higher levels of investment in public infrastructure. It acknowledged the strong growth in employment, projecting the unemployment rate to drop to around 5% over the next couple of years. The members, however, judged that low inflation and soft wage growth worth ongoing monitor before another rate hike. The policy statement was almost identical to the previous one, with only some changes seen in the assessments of the job market and exchange rate.

Policymakers were more upbeat over the employment situation. As suggested in the statement, "the unemployment rate has fallen to 5.3%, the lowest level in almost six years. The vacancy rate is high and there are reports of skills shortages in some areas”. Meanwhile, the members acknowledged that "wages growth remains low, although it has picked up a little recently". They expected that growth would be above trend in 1H18 but maintained the growth forecast unchanged. The central bank affirmed that the central growth forecast for GDP growth to average “a bit above 3 per cent” in 2018 and 2019. While noting positive business conditions, it reiterated concerns over domestic demand, suggesting that “one continuing source of uncertainty is the outlook for household consumption”.

AUDUSD has declined more than -3% since the August meeting. RBA attributed this to the strength of US dollar. As noted in the statement, RBA reiterated last meeting's rhetoric that Aussie "remains within the range that it has been in over the past two years on a trade-weighted basis". Yet, it added that the depreciation is mainly "against the US dollar along with most other currencies".

Given soft inflation, RBA would wait for significant increase in inflation before signalling a rate hike. The market currently expects it would keep the powder dry until 2020.

WTI oil accelerated higher on Tuesday, signaling continuation of broader uptrend after completion of three-day consolidation, which formed bullish pennant on daily chart.

Preparations for coming hurricane in the Gulf of Mexico, which resulted in closure of some oil platforms, boosted oil prices.

Also, expectations of lower production in Iran, due to US sanctions, adds to bullish outlook.

Fresh advance pressures pivotal barrier at $71.17 (Fibo 61.8% of $75.34/$64.43 descend), break of which is needed for another bullish signal.

Firmly bullish daily techs support scenario, with supports at $70.42/00 (former high / psychological support) expected to ideally contain dips and keep the downside protected.

Focus turns towards US weekly crude stocks reports (API report is due on Wednesday and EIA will release their crude inventories report on Thursday) with both reports being delayed one day due to US closure for Labor day holiday on Monday.

Res: 71.17, 71.64, 72.00, 72.77
Sup: 70.42, 70.00, 69.52, 69.27

It's been a relatively slow start to trading on Tuesday but things are expected to pick up, with Bank of England Governor Mark Carney making an appearance shortly and the US and Canada returning from the long bank holiday weekend.

Carney's appearance before the Treasury Select Committee on Tuesday comes with an additional twist, following reports that the Treasury is trying to persuade him to extend his term – which ends in the middle of next year - by another 12 months. Carney has already agreed to one extension in order to oversee the Brexit process and the government is clearly hopeful that he will contemplate one more so as to provide some source of stability in otherwise uncertain times.

It will be interesting to see whether Carney chooses to entertain questions on these negotiations or instead brushes them off for another day. He hasn't been the most popular of Governor's, primarily among Brexiteers, who are still angry about his predictions on the economy prior to the referendum in the event of a vote to leave. You have to wonder why Carney would choose to remain in the hot seat given the hand he's been given and the constant criticism he's received. Perhaps this is one reason why efforts are being made to retain him for now, it can't be one of the most sought after jobs at the minute.

While Carney's potential extension may provide a distraction during the event, the main purpose of the inflation report hearing is to discuss the latest quarterly report put out by the Bank of England on the economy. In August, the Monetary Policy Committee deemed it appropriate to raise interest rates by 25 basis points, taking interest rates above 0.5% for the first time since the start of 2009, despite the fact that the economy is only growing at a moderate rate and faces numerous risks heading into a hugely important few months for Brexit.

The hike was accompanied by an acknowledgement that future hikes will be gradual and that inflation is expected to return to target over the coming years. More importantly, they are based on the assumption of a smooth Brexit process, something that looks quite hopeful based on how negotiations are progressing which I expect will be questioned in detail today. As ever, it's likely to be a lively affair.

The US will also be back in focus today as the country returns from the Labor Day bank holiday. As ever, traders will be paying close attention to the political situation with Donald Trump seemingly at the centre of many things that are dominating the space right now. The inability to get a renegotiated NAFTA over the line last week was a setback for the US President ahead of the mid-terms and I expect to hear plenty more about this in the coming days and weeks. We'll also get the ISM manufacturing PMI from the US today.

The EUR/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.15958
Open: 1.16173
% chg. over the last day: +0.14
Day's range: 1.15742 – 1.16192
52 wk range: 1.0571 – 1.2557

Yesterday, trading on the EUR/USD currency pair was calm. The US financial markets were closed due to the holiday. Today, the EUR/USD quotes has been declining. At the moment, the trading instrument is testing the 1.15750 mark. The level of 1.15900 is already a "mirror" resistance. The EUR/USD currency pair has the potential for further decrease. Positions should be opened from the key levels.

The news feed on 2018.09.04:

The index of economic activity in the US manufacturing sector from ISM at 17:00 (GMT+3:00).

The price has fixed below 50 MA and 200 MA, which signals the power of sellers.

The MACD histogram is located in the negative zone and continues to decline, which indicates the bearish sentiment.

Stochastic Oscillator is in the neutral zone, the %K line is crossing the %D line. There are no signals at the moment.

Trading recommendations

Support levels: 1.15750, 1.15550, 1.15300
Resistance levels: 1.15900, 1.16300, 1.16600

If the price fixes below the local support of 1.15750, the EUR/USD quotes are expected to fall. The movement is tending to 1.15550-1.15300.

Alternative option. If the price fixes above 1.16100, we recommend considering purchases of EUR/USD. The movement is tending to 1.16400-1.16600.

The GBP/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.29131
Open: 1.28639
% chg. over the last day: -0.41
Day's range: 1.28408 – 1.28756
52 wk range: 1.2361 – 1.4345

The GBP/USD currency pair continues to show negative dynamics. The pound is under pressure due to uncertainty in the Brexit process and weak economic reports. In August, the index of economic activity in the UK manufacturing sector reached a two-year minimum. The indicator counted to 52.8, which is below market expectations at the level of 53.9. At the moment, the GBP/USD quotes are consolidating in the range of 1.28400-1.28700. The positions should be opened from these marks.

Important economic reports on 2018.09.04:

The index of economic activity in the UK construction sector at 11:30 (GMT+3:00).

The price has fixed below 50 MA and 200 MA, which signals the power of sellers.

The MACD histogram is in the negative zone, but above the signal line, which gives a weak signal to sell GBP/USD.

Stochastic Oscillator is located in the neutral zone, the %K line has crossed the %D line. There are no signals at the moment.

Trading recommendations

Support levels: 1.28400, 1.28000
Resistance levels: 1.28700, 1.29000, 1.29350

If the price fixes below the local support of 1.28400, further fall of the GBP/USD currency pair is expected. The movement is tending to the round level of 1.28000.

Alternative option. If the price fixes above the level of 1.28700, we recommend considering purchases of GBP/USD. The target movement level is 1.29000-1.29350.

The USD/CAD currency pair

Technical indicators of the currency pair:

Prev Open: 1.30722
Open: 1.30915
% chg. over the last day: +0.24
Day's range: 1.30892 – 1.31251
52 wk range: 1.2059 – 1.3795

The bullish sentiment continues to prevail on the USD/CAD currency pair. At the moment, quotes are testing the local resistance of 1.31250. The 1.30850 mark is already a "mirror" support. The trading instrument is tending to grow. We recommend paying attention to the news feed on the US economy. Positions should be opened from the key levels.

The publication of important economic reports from Canada is not planned.

The price has fixed above 50 MA and 200 MA, which signals the power of buyers.

The MACD histogram is in the positive zone and continues to rise, which signals to buy USD/CAD.

Stochastic Oscillator is located in the neutral zone, the %K line is above the %D line, which also gives a signal to buy USD/CAD.

Trading recommendations

Support levels: 1.30850, 1.30500, 1.30200
Resistance levels: 1.31250, 1.31500

If the price fixes above the resistance level of 1.31250, the USD/CAD quotes are expected to grow. The movement is tending to 1.31500-1.31750.

Alternative option. If the price fixes below the "mirror" support of 1.30850, it is necessary to consider sales of USD/CAD. The movement is tending to 1.30500-1.30300.

The USD/JPY currency pair

Technical indicators of the currency pair:

Prev Open: 110.051
Open: 110.986
% chg. over the last day: -0.04
Day's range: 110.901 – 111.463
52 wk range: 104.56 – 114.74

The USD/JPY currency pair is growing. During today's trading session, the growth of quotes has exceeded 45 points. The trading instrument approached the key resistance of 111.500. The 111.200 mark is already a "mirror" support. We do not exclude the further growth of the USD/JPY currency pair. We recommend opening positions from the key levels.

Today, the news feed on the economy of Japan is calm.

Indicators point to the power of buyers: the price has fixed above 50 MA and 200 MA.

The MACD histogram has moved to the positive zone and continues to rise, which indicates the bullish sentiment.

Stochastic Oscillator is located in the overbought zone, the %K line is above the %D line, which gives a weak signal to buy USD/JPY.

Trading recommendations

Support levels: 111.200, 111.000, 110.750
Resistance levels: 111.500, 111.800

If the price fixes above the resistance level of 111.500, further growth of the USD/JPY quotes is expected. The movement is tending to 111.800-112.000.

An alternative may be decrease of the USD/JPY currency pair to the round level of 111.000.

EUR/USD

Current level - 1.1573

The downtrend is intact, heading towards 1.1530. The latter should provide a base for reversal and should start another upswing, for 1.1750.

USD/JPY

Current level - 111.48

My outlook is counter-trend, for a reversal and dip towards 110.70 zone.

GBP/USD

Current level - 1.2840

The bias is bearish, for a dip to 1.2800 zone. The latter should provoke a rebound, for 1.2935 area.