EUR: HSBC: Cyclical Implication Of PMIs Is Clearly Negative
Aug-23 12:19
In light of today’s PMI prints HSBC note that “for EUR, the cyclical implications of these prints are clearly negative.”
- “Our constructive stance on EUR has been partly based on positive consumer and business momentum, which we expected to persist through the summer as inflation adjusted incomes started to rise and the services sector remained resilient.”
- “The latter has clearly been a big disappointment, while recent rises in energy prices threaten the recovery of real earnings. Some structural forces (strong current account) are still supportive but these are unlikely to be the focus for near-term momentum.”
- “The ECB may be caught in something of a bind going into its September meeting. Very sticky core inflation and wage pressures appear to call for more tightening, but much weaker activity data suggests the opposite.”
- “ECB market pricing has rowed back, but the further this declines, the more near-term downward pressure is likely for the currency.”
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US: MNI POLITICAL RISK - Congress Moves Slowly As Recess Looms
Jul-24 12:11
- Senate Majority Leader Chuck Schumer (D-NY) will attempt to wrap-up work on the National Defense Authorization Act this week before Congress departs for the August recess.
- US District Court Judge Aileen Cannon, the judge presiding over the trial of former President Donald Trump for his mishandling of classified government documents, has set a trial date of May 20, 2024 - right in the middle of 2024 presidential election campaign season.
- US Secretary of State Antony Blinken has suggested that the Biden administration is unlikely to remove sanctions on Chinese Defence Minister Li Shangfu to restore military-to-military contact.
- A Qatari delegation has visited Iran in a bid to mediate between Washington and Tehran on nuclear issues.
- Israeli Prime Minister Benjamin Netanyahu has pressed ahead with his controversial judicial reform plan, risking a fracture with Washington.
- US Secretary of State Antony Blinken says he believes Ukraine will be provided with advanced F-16 fighter planes but cautioned that it could take, “months and months before they were actually operational.”
- Poll of the Day: Consumer confidence has increased as economic concerns have receded.
Full article: US Daily Brief
STIR: SOFR Continues To Flicker Between 5.05-5.06%
Jul-24 12:06
REPO REFERENCE RATES (rate, change from prev. day, volume): * Secured Overnight Financing Rate (SOFR): 5.05%, -0.01%, $1400B * Broad General Collateral Rate (BGCR): 5.03%, no change, $590B * Tri-Party General Collateral Rate (TGCR): 5.03%, no change, $582B
SOFR dips back 1bp lower to 5.05% having flickered between 5.05 and 5.06% in the past two weeks, whilst volumes fall to $1400B for the lowest since Jul 11 and before that Jun 22.
Source: New York Fed
EURIBOR OPTIONS: Call fly buyer
Jul-24 12:06
ERU3 96.25/96.37/96.50c fly, bought for 1 in 2.5k.
