FOREX: USD Resolves Lower as Data Deteriorates

• The aforementioned return to pre-retail sales levels is short-lived, with TYZ5 lifting 5 ticks back to the 113-17+, near earlier highs of 113-18.
• Resistance at 113-29 (Sep 5 high).
• Cash yields are now 1.3-2.5bp lower on the day.
• 20s continue to underperform ahead of upcoming supply.

European Parliament President Roberta Metsola has confirmed that European Commision President Ursula von der Leyen will face two censure motions in the Parliament's plenary session running 6-9 October. The two seperate censure motions have been put forward by the far-left 'The Left' group and the right-wing nationalist Patriots for Europe (PfE) group, the former in protest of the Commission's stance on the war in Gaza, the latter to oppose the EU's trade deals with the US and the Mercosur bloc. 

• This will mark the second time in four months that VdL has faced censure motions in the EP, having survived a vote in July by a margin of 360 against to 175 in favour and 18 absentions, well short of the 480 vote two-thirds majority required to remove the president and her College of Commissioners.
• The motions were filed at the earliest possible deadline on 10 Sep, just hours after VdL delivered her State of the Union address, and highlights the deep political fragmentation within the Union on a wide range of issues ranging from foreign policy, to energy and the environment, to trade, and immigration.
• The October votes will inevitably be tallied against the July censure motion as a gauge of whether support for the Commission has waned further. That said, the two-thirds majority to remove VdL remains unlikely to be reached. 

Republican and Democratic leaders have maintained a hardline stance on funding the government, with both parties attempting to influence the direction of public opinion should a government shutdown take place on October 1. 

• Democrat conference chair Pete Aguilar (D-CA) said, “We will hold fast to our position and implore Republicans to abandon their go-it-alone approach,” referring to the GOP stonewalling of Democrat demands for the inclusion of Obamacare subsidies in a short-term funding bill.
• Senate Minority Leader Chuck Schumer (D-NY) said, “I want to be very clear about something. When Donald Trump goes on Fox News and says to Republicans, don't even bother to deal with Democrats when he says out loud that he says he doesn't need or want our votes. That means Donald Trump wants a shutdown.”
• Senate Majority Leader John Thune (R-SD) said Schumer is, “willing to shut the government down over a clean CR, something that last year and the year before, he said he wanted …. If you refuse to move a clean CR so the appropriations committees can do their work and we can do our work here in the Senate, you're essentially advocating for a government shutdown.”
• House Speaker Mike Johnson (R-LA) is expected to release the final bill text for a short-term funding bill momentarily. It is likely to be ‘clean’ (with no policy riders) and extend funding through November 20. A House vote is likely to take place on Friday.