STIR: Effective Fed Funds Steady, But Standing Repo Takeup Rises Again

US President Donald Trump and Israeli Prime Minister Benjamin Netanyahu are scheduled to begin a joint press conference at the White House shortly. LIVESTREAM At a bilateral meeting earlier today, Trump presented Netanyahu with a US-backed 21-point proposal to end the war in Gaza or face deeper international isolation.

• Axios notes, “Trump has never publicly blamed Netanyahu for prolonging the war with Hamas or failing to deliver a deal to free the remaining hostages. But if Netanyahu says no this time, some of Trump's aides think he might turn on the prime minister. Support for Israel and the war in Gaza has sunk to new lows, including at the White House and MAGA world more broadly.”
• Semafor notes, “The latest deal pushed by the Trump administration would freeze battle lines, see all remaining hostages released, destroy Hamas’ offensive weaponry, and offer limited amnesties for the group’s fighters. Yet Israel may oppose some of the requirements, while Arab mediators have also submitted their own revisions.”
• Bloomberg notes, “Israeli officials have declined to confirm or deny the details. One top Israeli official, speaking on condition of anonymity, called some of the reported points fake trial balloons.”
• NYT reports that in the coming days, US ambassador to Israel, Mike Huckabee, will become the first sitting ambassador to visit Egypyt will travel visit Egypt in decades, a potential signal that a postive deal is in the works.

• +6,000 SFRX5 95.50/97.00 strangle w/ 95.75/96.87 strangle, 1.25 total for package

• The USD index has started the week on the back foot, consolidating a modest 0.25% move lower on the session amid US government shutdown concerns. Associated gains in G10 have been centred around the Japanese yen and notably, the Australian dollar ahead of tomorrow’s RBA decision.
• With USDJPY moving average studies highlighting a dominant uptrend, today’s 0.6% pullback appears technically corrective. Sights are on 150.92, the Aug 1 high and key resistance, while pivot support remains much further out at 145.49, Sep 17 low. Some market participants have sighted BOJ board member Asahi Noguchi’s comments as potentially assisting the yen bid on Monday.
• AUDUSD (+0.52%) edged back towards the 0.66 handle ahead of Tuesday’s central bank decision. With the RBA widely expected to be on hold in September, the focus will be on the tone of the statement and Governor Bullock’s press conference for guidance on the Board’s current thinking. Given the bullish underlying theme for AUDUSD, attention is on 0.6707, the Sep 17 high. Initial firm resistance to watch is 0.6628, the Sep 24 high.
• it’s worth noting that AUDJPY remains in a strong uptrend, with the 20-day EMA acting as very strong support in recent weeks. Additionally, an area between 97.25-45 continues to hold, while the uptrend from the April lows remains intact.
• GBPUSD’s move lower last week resulted in a break of 1.3491, a trendline support drawn from the Aug 1 low. Both 20- and 50-day EMAs also now intersect close to 1.3490, emphasising the short-term significance of this level.
• Ahead of the RBA, the BOJ summary of opinions and China PMIs are scheduled. German and French inflation releases are then due, before the US JOLTS jobs data.