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#VIX, vols collapse drove Eq recovery in Aug / German inflation 1.9% in Jul / EZ HICP & U.S PCE today's focus / #USDCNH 15months lows / DollarGeneral earnings..

Writer's picture: StéphanStéphan
Aug 30, 20244 min read


  • Today, focus is on (CET time) 11:00 EU HICP and 14:30 US PCE, and UMich later on, China markets rallying hard this morning, Techs up most since June and Yuan strengthens to 15-month highs (USDCNH 7.07), DJ, DAX made new highs too

  • Many commentators say the U.S economy is super strong, The U.S is running a historic deficit, never seen before outside of WW2, the GFC or Covid, if the U.S wasn't running this deficit and balance the budget, GDP would be very different (mid, this is not a U.S centric issue, similar stories in other parts of the world)

  • China is considering allowing homeowners to refinance as much as $5.4 trillion in mortgages to lower borrowing costs for millions of families and boost consumption >>> note USDCNH on 16mos lows, is ALL or mostly about USD weakness really (long USDCNH was/is a BIG carry trades..)

  • Equity markets rock'n roll in August, ALL or most about #VIX really, which exploded higher early August, and subsequently collapsed over last few weeks... chart here : United States Stock Market Index (USVIX) - Index Price | Live Quote | Historical Chart (tradingeconomics.com)

  • #TwoSpeedEconomy : Dollar General warns poorer US consumers are running out of money >>> ''While Wall St debates the rate of change of inflation, the average person lives its cumulative rise'' a company that never really missed, they just did, stock down 30%, brutal reaction from market

  • Inflation in Germany fell to 1.9% in August, first time below 2% since March 2021

  • Saxo : Technical Update - Nvidia’s bullish trend in jeopardy after earnings – Key levels to watch!

  • Intel Corp. is working with investment bankers to help navigate the most difficult period in its 56-year history

  • Allstate Approved to Raise Home Insurance Rates by 34% in Wildfire-Prone California

  • The Richmond Fed Manufacturing index dropped to -19 points in August from -17 points in July, to the lowest since the 2020 Pandemic. This is one of the 5 regional Fed surveys that have a high correlation with the nationwide ISM PMI manufacturing index data

  • UK Police Warn Elon Musk of Legal Consequences

  • How Russian hackers stole millions from U.S. investors/Video-CNBC report

 


The BIG surprise would by 6.50 area over next 12months #USDCNH, as markets unwind the HUGE carry trade in that pair, this would obviously influence other USD pairs and keep USD under pressure, which may actually be 'welcome' by new U.S administration





Interesting watch, if you haven't seen it already




“I want to provide some additional context around what we’re seeing and hearing from our customers. The majority of them state that they feel worse off financially than they were six months ago as higher prices, softer employment levels and increased borrowing costs have negatively impacted low income consumer incentive. As a result, our core customer who contributes approximately 60% of our overall sales comes predominantly from households earning less than $35,000 annually >>>>>>>>> the two speed economy, economic headlines look good, things going ok, but underneath it isn't, top percentile distorting data and is not the same story for majority down below (to a certain extent it was ever so, probably, but it's on extremes now... If FED cuts aggressively they will help asset rip higher and benefit top percentile only, while poorest won't benefit much from any of it, since they have little or not assets, #TwoSpeedEconomy












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