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Writer's pictureStéphan

Trump talks big tariffs / NFP as exp, weakening trend / China PPI down / Next focus : The U.S debate and U.S inflation on Wed



  • Chinese inflation data : producer prices fell by 1.8% yoy, more than expected, driving the disinflationary trend

  • OIL MARKET: First day of the annual APPEC oil conference in Singapore, and the commentary so far is rather downbeat, disinflationary trend/Thread

  • FED Sep meeting : the doves will have had a reasonably weak NFP to call for 50bps cut, payroll trend weakening, for now our best case is 3 or 4 25bps cut (as, risk is a 50bps cut is too 'hard landing') >>> overall big distribution of possible economic outcomes with U.S election and other geopolitics in months ahead, soft commodities, crude, China, USD-debt relationships + long positioning in equity markets overall >>> Week's focus is Wednesday U.S inflation data, this weel markets will look for a relief risk rally on soft ish U.S inflation

  • Donald Trump Trump threatens to impose a 100% tariff on countries that conduct business in currency other than the US Dollar, adding a new pillar to his tariff platform

  • US NFP : 4.2% , below consensus at 142k, together with downward revisions of 86k in prior two months, with more of the downgrade concentrated in June. U.S personal savings rate now down to 2.9%, lowest since June 2022, average over last 30years is 5.7%...persistent inflation taking its toll

  • Eurozone Q2 GDP: Eurozone economy grew less than exp in the Q2, rising 0.2% from the prev quarter – less than the 0.3% initially reported >>> Draghi to Unveil Plan Aimed at Curing EU’s Single Market Malaise

  • Yellen says U.S. economy remains solid, on path to ‘soft landing’ with no meaningful layoffs

  • Crypto sees weekly outflow of $600 billion, the 2nd largest weekly outflow in history >>>> just another leveraged/risk on/short vol play...

  • The exact difference in electricity consumption between a ChatGPT query and a Google search can vary, but generally, ChatGPT searches use more energy due to the greater computational power involved in running large language models

  • USDollar likely to do somewhat better over next few weeks, as liquidity diminishes, risk likely to 'struggle' overall >>>> 1.1200/00 EURUSD, 1.3200/50 CABLE tops, similarly AUDUSD 0.6800+ etc and lows in USDCHF around 0.8400 CHF, to get bullish USD would watch 50dmas, if they fail to hold like CABLE around 1.2950 area, then we can see a bigger counter move on USD


 



Trump, who has long embraced protectionist trade policies, said the dollar has been “under major siege” for 8yrs. China, India, Brazil, Russia, and South Africa discussed de-dollarization at a summit last year. By contrast, Trump has said he wants the dollar to remain the world’s reserve currency, a pledge he renewed at Saturday’s rally.

















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