Aussie modestly higher ahead of European markets open

Major currencies are mostly little changed overall

WCRS 20-08
ForexLive

The aussie is holding a little higher after the RBA minutes release continued to suggest that the central bank will likely stay on hold at its September meeting.
WIRP AU 20-08

The kiwi is also lifted higher as such but the rest of the major currencies remain more subdued to start the new day. Changes against the dollar are less than 0.1% and the trading ranges remain relatively narrow ahead of European trading.

As for risk sentiment, equities are hold more steady around flat levels awaiting for fresh direction. With the market focus slowly shifting towards Jackson Hole, only trade headlines will matter at this point in between now and then.

Looking ahead, do continue to keep an eye on the bond market in the days ahead. Treasury yields are holding a little lower currently and a bigger drop may see other asset classes start reacting more profoundly once again.

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Japan media reports the G7 summit this weekend may end acrimoniously due to trade dispute

HIGH RISK WARNING: Foreign exchange trading carries a high level of risk that may not be suitable for all investors. Leverage creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully consider your investment objectives, experience level, and risk tolerance. You could lose some or all of your initial investment; do not invest money that you cannot afford to lose. Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions.

ADVISORY WARNING: FOREXLIVE™ provides references and links to selected blogs and other sources of economic and market information as an educational service to its clients and prospects and does not endorse the opinions or recommendations of the blogs or other sources of information. Clients and prospects are advised to carefully consider the opinions and analysis offered in the blogs or other information sources in the context of the client or prospect’s individual analysis and decision making. None of the blogs or other sources of information is to be considered as constituting a track record. Past performance is no guarantee of future results and FOREXLIVE™ specifically advises clients and prospects to carefully review all claims and representations made by advisors, bloggers, money managers and system vendors before investing any funds or opening an account with any Forex dealer. Any news, opinions, research, data, or other information contained within this website is provided as general market commentary and does not constitute investment or trading advice. FOREXLIVE™ expressly disclaims any liability for any lost principal or profits without limitation which may arise directly or indirectly from the use of or reliance on such information. As with all such advisory services, past results are never a guarantee of future results.

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NASA program “OMG” trying to find out how fast Greenland’s ice is melting

Greenland’s ice sheet is melting six times faster than in the 1980s. This month, it lost 11 billion tons of surface ice in one day, enough to fill more than four million Olympic-sized swimming pools.

Summer came sooner there and is expected to last longer. Greenlanders said they’ve seen more extreme weather and fishermen are catching warmer-water fish. They’re living with climate change and scientists have come from around the world to study why.

Josh Willis of NASA’s Jet Propulsion Laboratory is in the fourth year of a five-year research project he designed. His team is dropping probes into the ocean to understand how the waters around Greenland are warming and contributing to the melting of glaciers.

On Saturday, Willis’ team dropped probes telling them the saltiness and the temperature of the water during a nearly seven-hour flight covering more than 800 miles.

“We usually think of Greenland’s ice as a sort of ice cube with a hairdryer on it, but in fact that ice cube is sitting in a pot of water too,” Willis told Seth Doane for “CBS This Morning.” “And the water is warming up as well and the two things together can combine to create sea level rise that happens much more rapidly than what we originally anticipated.”

Willis named his program “Oceans Melting Greenland.” Its acronym, “O-M-G,” was no mistake. He said humankind should be surprised and pay attention.

“There’s enough ice in Greenland to raise sea levels by 25 feet worldwide,” Willis said. “Now, we don’t think it’ll happen right away, but just how fast it does is something we’re trying to figure out with OMG.”

Greenland may feel like a remote place, but what happens there will make a difference to anyone living in a coastal area around the world.

“We all live with one ocean,” Willis said. “So a billion tons of ice lost here in Greenland means higher sea levels in Florida, California, New York, even as far as Australia.”

So far, OMG’s missions have shown how sensitive glaciers are to the ocean. And they’ve also produced a better map of the sea floor, allowing them to gauge which glaciers are threatened. The answer: more than they thought.

© 2019 CBS Interactive Inc. All Rights Reserved.

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World – CBSNews.com

Yuan wobbles on Trump trade comments, details of China rate reforms awaited

HONG KONG (Reuters) – The yuan wavered on Monday after U.S. President Donald Trump said he was not ready yet to make a trade with China.

Traders were also cautious ahead of the debut of China’s new benchmark lending rate on Tuesday, which was announced at the weekend.

Analysts believe the reforms will open the door to rate cuts, possibly as early as Tuesday, but are divided over the size of any initial reduction and how much it may help struggling smaller companies in the near term.

Spot yuan traded at 7.0447 per dollar at midday, pretty much unchanged from the last session close and 0.12 percent away weaker than the midpoint , which was set by the People’s Bank of China at 7.0365.

The central bank on Saturday unveiled long-awaited interest rate reforms to help lower borrowing costs for companies and support slowing growth, which has been dragged by its protracted trade war with the United States.

The revamped loan prime rate (LPR), effective on Tuesday and linked to rates in medium-term lending facility (MLF), is the equivalent of a 45 basis point rate cut on loans, ANZ analysts wrote in a note on Monday. Several traders said they expect the new LPR to trim by 10 to 15 basis points.

The tweak will help achieve the State Council’s goal of easing financing costs for small businesses by 1 percentage point, but tax cuts will also shoulder part of that, according to a Shanghai-based trader.

“We need to hear more about the supplementary measures,” to gauge how far LPR and MLF rates will fall, said another trader in Shanghai.

However, unlike more open markets such as the United States, China’s capital control will likely cap the pressure from lower interest rates on its managed currency, said a Hong Kong-based trader, adding “it will trade where the PBOC wants it to be.”

Traders said the U.S.-China trade talks will continue to dominate the yuan’s direction in the near term.

White House economic adviser Larry Kudlow said on Sunday trade officials from the two countries would speak within 10 days and a Chinese delegation is flying to the United States to follow up.

But Trump said on the same day he is “not ready” for a deal with Beijing, hinting again that he would like to ongoing protests in Hong Kong resolved first.

Trump also said he would not like to deal with Huawei Technologies Co Ltd – even after Reuters and other media outlets reported on Friday the U.S. Commerce Department is expected to extend a reprieve for the company to buy supplies from U.S. companies.

The was trading 0.14 percent softer than the onshore spot at 7.0545 per dollar.

The global () rose slightly to 98.207 from the previous close of 98.142.

US China interest rate – Aug 19, 2019 – https://fingfx.thomsonreuters.com/gfx/mkt/12/4892/4849/US%20China%20interest%20rate%20-%20Aug%2019,%202019.jpg

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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Forex – Dollar Hovering Near 2-Week Highs, Sterling Edges Up

© Reuters.  © Reuters.

Investing.com – The U.S. dollar was hovering near two-week highs against a currency basket on Monday as U.S. Treasury yields bounced back from recent lows amid hopes that major economies will seek to prop up slowing growth with fresh stimulus.

The , against a basket of six major currencies was at 98.05 by 03:01 AM ET (07:01 GMT), not far from the two-week high of 98.20 reached on Friday.

The stood at 1.57%, having pulled away from a three-year trough of 1.47% marked last week in the wake of global slowdown fears.

Falling yields last week caused the two-year/10-year Treasury curve to invert for the first since 2007, a phenomenon widely regarded as a recession signal that puts the Federal Reserve interest rate deliberations into focus.

“This week’s main event is the Jackson Hole symposium and Fed Chairman (Jerome) Powell’s speech,” said Junichi Ishikawa, senior FX strategist at IG Securities in Tokyo.

Powell will deliver a speech on Friday at an annual meeting of central bankers in Jackson Hole, Wyoming.

“What Powell has to say is in focus as the discrepancy remains between what he said on interest rates and what the markets have come to expect the Fed will do,” Ishikawa said.

Powell said after the Fed lowered rates in July that the easing was not the start of a series of cuts. But market expectations for the Fed to cut rates by another 25 basis points at the next policy meeting in September have increased.

The was steady at 1.1092 while the edged up 0.15% to 1.2166.

The dollar was little changed against the at 106.37.

The was slightly lower after U.S. President Donald Trump said he was not ready yet to make a trade with China.

Traders were also cautious ahead of the debut of China’s new benchmark lending rate on Tuesday, which was announced at the weekend.

The People’s Bank of China on Saturday unveiled interest rate reforms to help lower borrowing costs for companies and support slowing growth, which has been hit by the trade war with the U.S.

–Reuters contributed to this report

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

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AUD spot currently above fair value model mid point

HIGH RISK WARNING: Foreign exchange trading carries a high level of risk that may not be suitable for all investors. Leverage creates additional risk and loss exposure. Before you decide to trade foreign exchange, carefully consider your investment objectives, experience level, and risk tolerance. You could lose some or all of your initial investment; do not invest money that you cannot afford to lose. Educate yourself on the risks associated with foreign exchange trading, and seek advice from an independent financial or tax advisor if you have any questions.

ADVISORY WARNING: FOREXLIVE™ provides references and links to selected blogs and other sources of economic and market information as an educational service to its clients and prospects and does not endorse the opinions or recommendations of the blogs or other sources of information. Clients and prospects are advised to carefully consider the opinions and analysis offered in the blogs or other information sources in the context of the client or prospect’s individual analysis and decision making. None of the blogs or other sources of information is to be considered as constituting a track record. Past performance is no guarantee of future results and FOREXLIVE™ specifically advises clients and prospects to carefully review all claims and representations made by advisors, bloggers, money managers and system vendors before investing any funds or opening an account with any Forex dealer. Any news, opinions, research, data, or other information contained within this website is provided as general market commentary and does not constitute investment or trading advice. FOREXLIVE™ expressly disclaims any liability for any lost principal or profits without limitation which may arise directly or indirectly from the use of or reliance on such information. As with all such advisory services, past results are never a guarantee of future results.

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Event risk playbook for the week beginning August 19

What’s coming next for global markets

Bonds are painting an ever-dour message on Fed policy, an end to globilsation and slower global growth. We look ahead to next week. 

As I review in the ‘Event risk playbook’, the market will trade in anticipation of Friday’s Jackson Hole Symposium, and what will be and what wont be said, and who will say it – this will be the only thing that matters. The title of the sympoeseum, and what is in effect a massive cental banker shindig, is “challenges to monetary policy”. Consider that one of the reasons we have seen buyers of gold, global bonds and JPY is that the world is questioning the central bank put. But also because many just don’t believe that monetary policy can save us if this downturn gets momentum.

A look at global markets

I am inclined to agree. Therefore the emphasis of the symposium falls not only on the level of confidence bankers can instal in the belief they have the firepower to curb any economic fallout. But on how much of a role fiscal policy needs to play in the period ahead.

The question of who represents the Fed is critical ,and after NY presdient John Williams communication mishaps a couple of weeks ago, the market will be hoping to hear from the main man on the Fed, vice chair Richard Clarida. While he may be more dovish than others voting members, the market will listern to him above all others.

Aside from the Fed, we should hear from key represwentaitves from the ECB, BoJ and other DM and EM centrals banks. With trade tnessions, flatter curves and a belief that policy isnt working or going to work, this event is going to be a possible game-changer.

If we look at my weekly implied volatility (IV) report, the IV covers FX options that expire on Friday (NY cut), so doesn’t account for the Monday open. If the Fed stay behind the curve, and continue to  lack any urgency to get in front of the cruve, Mondays (26th) open could be pretty ugly. I will update this spreadsheet on Monday to account for the event risk. 

Implied volatility

If you have a spare hour (I know, who does these days?), I have put down the link for my recent webinar on using volatility as a framework to manage risk. It breaks down this spreadsheet and how you can apply/understand risk reversals, the weekly Commitment of Traders report and have a deeper perspective on implied and realised volatility – https://youtu.be/f_12P86jUfk

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‘You can still sense the love’: Baby boomers revel at Woodstock 50 years on

By Gabriella Borter

BETHEL, N.Y. (Reuters) – Baby boomers dressed in tie-dye, rolling wheelchairs and chasing a memory of peace and love flocked to Bethel, New York, for the weekend to mark the 50th anniversary of Woodstock, the music festival that defined 1960s counterculture.

Thousands of flower-crowned visitors made the journey to the Bethel Woods Center for the Arts, which now owns the original festival site, to hear some of the same musicians including Arlo Guthrie, attend a planned Saturday concert by Santana, and feel the spirit of community that the 1969 festival produced.

“Even though I’m seeing the site 50 years later, I feel like I’m there at the first concert,” said Peter Hadley, 63, who arrived on Thursday. “Everybody greets us, talks to us. It’s the love that started back in ’69 and it’s present here, now.”

Woodstock, which was held at Max Yasgur’s dairy farm in upstate New York from Aug. 15-18 and featured about 30 acts, became a logistical nightmare when more than 400,000 people showed up, causing traffic gridlock for miles.

This weekend, in stark contrast to 1969, attendees found metal detectors, indoor plumbing and abundant food vendors at the Bethel Woods Center, which is hosting several concerts to mark the anniversary.

But those making the return trip said they had been unfazed by the chaos and unsanitary conditions in 1969, and instead remembered the kindness of locals, law enforcement and other concert-goers who offered food and medical aid.

“Everything that could go wrong went wrong. But everything went right,” said Duke Devlin, 77, who hitchhiked to Woodstock from Texas and has lived near the festival venue ever since. “We were bombarded with bliss.”

Arlene Seymour, 69, arrived for the weekend wearing the same tie-dye shirt she bought on her way to the 1969 concert. She fondly recalled sharing food with people she had just met and sleeping in the trunk of a stranger’s car to avoid the rain.

“It just wouldn’t happen like that today,” she said. “Because of the environment in the world, people would be worried to have it so loose.”

The anniversary attracted not just baby boomers. Younger people, dressed in throwback bell-bottoms and fringes, came to experience the atmosphere they missed in 1969.

Down the road from Bethel, a more informal reunion with music was taking place to mark the weekend in a style reminiscent of 50 years ago.

“You can still sense the love,” said Michelle Lecuyer, a 53-year-old sales director from New Hampshire, who described standing on the field where rock legends like Jimi Hendrix, Joe Cocker and Janis Joplin performed as experiencing “a slice of heaven.”

Previous Woodstock anniversaries have not fostered such harmony. People threw mud at performers at a rain-drenched Woodstock ’94 in Saugerties, New York. A fire broke out at the 30th reunion in Rome, New York, and the event devolved into violence.

Last month, original Woodstock producer Michael Lang’s plans for a 50th anniversary festival fell through when the organizers failed to secure a venue and headliners including Jay-Z and Miley Cyrus dropped out.

But the gray-haired crowds gathered in Bethel were determined to have peace. Ignoring the rain on Thursday and Friday and the omens of Woodstock reunions past, they held hands in a circle around a peace sign on the lawn, smoked blunts while singing along to Arlo Guthrie, and swayed to the rhythm of their generation.

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Sports and General News

Gibraltar releases Iranian tanker

Not clear where the tanker is headed

Not clear where the tanker is headed

A Gibraltar court released the Grace 1 tanker on Saturday and the ship is preparing for departure.

The move came despite US objections and appeals. The US government issued a warrant to seize the ship, saying all oil aboard the ship is subject to forfeiture due to a “scheme to unlawfully access the US financial system to support illicit shipments” of oil in violations of sanctions.

Refinitiv datea shows the status of the ship changed from ‘at anchor’ to ‘underway using engine.’

Iran seized a British oil tanker in the Strait of Hormuz earlier this month, likely in retaliation for the seizure. At the time, the move heightened tensions and boosted oil prices.

WTI closed the week at $ 54.87 and Brent at $ 58.64.

In other oil news, a Saudi oil plant in the Shaybah field was attacked by drones Saturday, causing a limited fire. Saudi officials said the fire was contained and operations were not affected.

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