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SYMBOL
LAST
BID
ASK
HIGH
LOW
NET CHG.
%CHG.
SPREAD
SPX
S&P 500 Index
6870.39
6870.39
6870.39
6895.79
6858.28
+13.27
+ 0.19%
--
DJI
Dow Jones Industrial Average
47954.98
47954.98
47954.98
48133.54
47871.51
+104.05
+ 0.22%
--
IXIC
NASDAQ Composite Index
23578.12
23578.12
23578.12
23680.03
23506.00
+72.99
+ 0.31%
--
USDX
US Dollar Index
98.950
99.030
98.950
99.060
98.740
-0.030
-0.03%
--
EURUSD
Euro / US Dollar
1.16426
1.16443
1.16426
1.16715
1.16277
-0.00019
-0.02%
--
GBPUSD
Pound Sterling / US Dollar
1.33312
1.33342
1.33312
1.33622
1.33159
+0.00041
+ 0.03%
--
XAUUSD
Gold / US Dollar
4197.91
4197.91
4197.91
4259.16
4191.87
-9.26
-0.22%
--
WTI
Light Sweet Crude Oil
59.809
60.061
59.809
60.236
59.187
+0.426
+ 0.72%
--

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India Clean Energy Ministry: No Advisory Issued To Pause Or Halt New Clean Enegry Financing

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Kuwait August CPI +0.07% Month-On-Month

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Chinese Navy: Japan's Related Claims Are Completely Inconsistent With The Facts

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Chinese Navy: Japanese Self-Defense Force Aircraft Repeatedly Approached And Disrupted The Chinese Navy's Training Areas

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[Lilly's Mufonta® (Telborpeptide) Included In National Medical Insurance For The First Time] On December 7th, The 2025 National Basic Medical Insurance, Maternity Insurance And Work Injury Insurance Drug Catalog Was Released, And Lilly's Gip/Glp-1 Ra Mufonta® (Telborpeptide Injection) Was Successfully Included. The Medical Insurance Coverage For Telborpeptide Applies To Glycemic Control In Adult Patients With Type 2 Diabetes: Adult Patients With Type 2 Diabetes Whose Glycemic Control Remains Inadequate Despite Treatment With Metformin And/or Sulfonylureas, In Addition To Diet And Exercise. The New Catalog Will Officially Take Effect On January 1, 2026

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Russia's Defence Ministry: Russia's Air Defence Units Destroy 77 Ukrainian Drones Overnight

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Australia Defence Minister Marles: We Want Most Productive Relationship We Can Achieve With China

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Japan Defence Minister Koizumi: Discussed With Marles Our Common Serious Concerns About Situation In South China Sea, East China Sea

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Australia Defence Minister Marles: Australia Will Work To Uphold Free And Open Indo-Pacific

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Kremlin Welcomes The Removal Of Russia From The List Of USA Direct Threats In New National Security Strategy, Tass Reports

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China Forex Reserves $3.346 Trillion At End-Nov Versus$3.343 Trillion At End-Oct

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Mayor: Russian Strike Hits Ukrainian City Of Kremenchuk, Cutting Utilities

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White House: To Establish Food Supply Chain Security Task Forces To Protect Competition

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Senior US Diplomat Calls EU Policies Bad For Trans-Atlantic Partnership

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US Defense Secretary Hegseth: He Would Have Ordered Second Strike On Caribbean Vessel

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USGS Estimates Greece Earthquake At Magnitude 4.8

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GFZ: Earthquake Of Magnitude 6.36 Strikes Greece

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USGS - Magnitude 7 Earthquake Strikes Yakutat, Alaska Region

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          OECD or BRICS? Key Members' Differences Might Weaken ASEAN Unity

          Warren Takunda

          Economic

          Summary:

          Indonesia, Malaysia, Thailand all pursue different 'diversification' strategies.

          A series of ASEAN-hosted meetings in Laos last month highlighted shifts in the regional bloc's diplomatic dynamics and the evolving geopolitical landscape in Southeast Asia.
          The three-day forum, which ended on July 27, included a meeting of ASEAN foreign ministers and a gathering of top diplomats from major countries and regions, including Japan, the U.S., China, India and the European Union. The regional bloc seemed eager to showcase its diplomatic influence in promoting global peace and stability through dialogue.
          Yet, three key founding members of ASEAN -- Indonesia, Thailand and Malaysia -- are pursuing different strategies to broaden their respective international partnerships.
          Shortly after meeting with Russian Foreign Minister Sergey Lavrov on July 28, Malaysian Prime Minister Anwar Ibrahim announced Malaysia's application for BRICS membership. Lavrov had visited Malaysia for two days following ASEAN foreign ministerial meetings in Laos.
          In February, Indonesia applied to join the Organisation for Economic Co-operation and Development, which began reviewing its application in May. Thailand applied to the OECD in April and also sought BRICS membership in June.
          Founded in 1961, the OECD consists of 38 countries, mostly from Europe and the Americas, with the only Asian members being Japan and South Korea. BRICS was established in 2006 by Brazil, Russia, India and China, with South Africa joining in 2011 and four countries, including the United Arab Emirates and Iran, added in January, making it a group of nine countries.
          The OECD is known as a "club of developed countries," while BRICS positions itself as the "voice" of the Global South. These two groups have starkly different characters. The moves by the three ASEAN countries to broaden their international partnerships seem somewhat mismatched with their economic standings.
          According to the International Monetary Fund, gross domestic product per capita is estimated at $12,570 for Malaysia, $7,337 for Thailand and $4,942 for Indonesia. From this perspective, Malaysia seems closest to OECD qualifications, while Indonesia's position looks more aligned with BRICS.
          Why, then, has Jakarta opted to seek the membership of the OECD, not BRICS?
          "At this point in time Indonesia sees BRICS as too politically motivated and driven too much by the geopolitical interests of some of its members," said Yose Rizal Damuri, executive director at the Center for Strategic and International Studies (CSIS) in Indonesia.
          "There are two reasons that I think behind Indonesia's consideration to join it. First, Indonesia wants to elevate its credibility that might be useful to improve its position as investment destination and part of global supply chain. Second, the current administration put economic reform as its priorities," Damuri continued.
          "President Jokowi and its team want the reform to continue and become the legacy of the incoming administration. Joining the OECD would bring Indonesia's commitment to continue the process."
          Meanwhile, Malaysia's choice to pursue BRICS over the OECD stems from a "strategic necessity to diversify economic partnerships and reduce overreliance on the U.S. dollar," said Abdul Razak Ahmad, founding director of Bait Al Amanah, a private think tank.
          "BRICS, which began as an economic alliance, has gradually evolved into a significant geostrategic platform. This transition appeals to Malaysia as it aims to navigate the current geopolitical complexities and avoid the entrapment risks associated with major power rivalries," he said.
          Thailand is seeking membership in both the OECD and BRICS because the former represents the largest current market, while the latter offers access to a potentially big future market, according to a senior Thai government official. Since the Asia-Pacific Economic Cooperation (APEC) forum, to which Bangkok belongs, includes members from both the OECD and BRICS, pursuing both memberships is a logical step, the official added.
          While the three countries have consistently advocated for "neutral diplomacy," their individual choices -- shaped by economic interests and political calculations -- reveal unique "diplomatic DNAs" rooted in history.
          Indonesia gained international recognition as a leader among nonaligned countries when it hosted the 1955 Asia-Africa Conference (Bandung Conference). It was also the only ASEAN member at the Group of 20 summit, launched in 2008. When it chaired the G20 summit in 2022, Indonesia achieved the diplomatic feat of issuing a joint statement despite the challenges posed by Russia's invasion of Ukraine.
          A natural extension of this elevated international status is Indonesia's pursuit of OECD membership. "Indonesia seems eager to join the club of developed countries to participate in the rule-making process," said a senior official at Japan's foreign ministry.
          Thailand, known for its "balancing diplomacy," was the only Southeast Asian nation to retain its independence while its nearby-countries were colonized by Western imperial powers -- Vietnam, Cambodia and Laos by France, and Burma (now Myanmar) by Britain. It preserved its sovereignty by serving as a buffer zone between the two Western powers.
          While being one of the five U.S. allies in the Pacific region, alongside Japan, South Korea, Australia and the Philippines, Thailand maintains close ties with China and Russia. Its strategy of blending elements from both the OECD and BRICS could be viewed as either opportunistic or savvy diplomacy.
          For Malaysia, reducing reliance on the U.S. dollar is a key motive for joining BRICS, a lesson learned from the East Asian currency crisis a quarter-century ago.
          When many East Asian countries faced shortages of foreign currency, the IMF required austerity measures and interest rate hikes as conditions for its support. Malaysia, however, rejected these conditions, choosing instead to implement capital controls and interest rate cuts. This approach led to a V-shaped recovery that surprised the world, while Thailand and Indonesia suffered severe recessions.
          This experience left Malaysia with deep distrust toward the Washington Consensus, a set of economic policy prescriptions promoted by the U.S., the IMF and the World Bank for developing countries facing economic hardship.
          Asian currencies remain vulnerable to higher U.S. interest rates, and Anwar's sudden mention last year of an Asian Monetary Fund, similar to the IMF, underscores his desire to reduce the country's reliance on the dollar. This likely explains Malaysia's interest in joining BRICS, which seeks to boost settlements in member currencies.
          But why the rush? The answer may lie in the recent foreign ministers' meetings in Laos, which revealed the limits of ASEAN diplomacy.
          In an editorial titled "ASEAN's copy-paste concerns," Indonesia's Jakarta Post daily criticized how ASEAN meetings have produced "simply repetitions of the same statements the group has issued year after year." The paper said the bloc has been playing it safe and avoiding open friction among members when confronting sensitive issues such as the South China Sea.
          ASEAN has been trying to enhance its collective presence in the international community through unified voices, but its dysfunction has become increasingly clear.
          "The regional order has become entangled in the U.S.-China rivalry," said Kei Koga, an associate professor at Nanyang Technological University in Singapore. "This has created a sense of urgency for Indonesia, Thailand and Malaysia to adopt to the changing strategic environment.
          "While these countries won't abandon ASEAN, they clearly see the limits of its external influence."
          In the case of BRICS, Thailand and Malaysia may face few obstacles to joining. With dominant members like China and Russia holding significant decision-making power and unclear membership terms and procedures, their applications could be approved as early as the summit in Russia in late October.
          In contrast, Indonesia and Thailand will likely face big hurdles in their bids to become OECD members. To join the group, both countries must undergo rigorous reviews on a wide range of criteria, including free trade, investment, anti-corruption, environmental protection and climate change initiatives. Acceptance requires unanimous approval of all the existing members, a process that could take years.
          On Aug. 8, ASEAN celebrated its 57th anniversary. From its initial identity as an anti-communist alliance, it shifted its focus to building an economic community after the Cold War, gradually expanding its membership and deepening internal cooperation.
          Once hailed as "the most successful regional group in the world," ASEAN now faces significant centrifugal forces amid a broader reshaping of global orders and increasing multipolarity.

          Source: NikkeiAsia

          To stay updated on all economic events of today, please check out our Economic calendar
          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
          Add to Favorites
          Share

          Iran Opens New Directions for Oil Exports

          Kevin Du

          Energy

          Iran continues to actively expand the geography of its oil exports despite ongoing sanctions from the United States and the international community. In recent months, Tehran has intensified its efforts to find new markets, effectively adapting to challenging conditions and finding ways to circumvent sanction barriers. Amidst sanctions and economic pressure, Iran demonstrates resilience and flexibility, ensuring stable oil supplies to international markets.
          One of Iran's significant steps has been the opening of new export destinations. For the first time, oil was sent to countries such as Bangladesh and Oman . It is reported that small batches of Iranian oil were delivered to these countries in early 2024.
          The American human rights group United Against Nuclear Iran (UANI) recorded that the Liberian-flagged tanker Golden Eagle, which previously loaded oil from Iran's Kharg Island, transferred part of its cargo onto smaller tankers near the port of Chittagong in Bangladesh. Although the Bangladeshi state oil corporation denies purchasing this cargo, the exact buyer remains unknown.
          Additionally, Iranian oil was delivered to the Omani port of Sohar. In June 2024, a tanker carrying presumably Iranian oil arrived at the port after a ship-to-ship transfer.
          An interesting aspect of Iran's new strategy is the reduction in supply volumes to Syria, traditionally an important market for Iranian oil. In 2024, supplies averaged 57.19 thousand barrels per day, significantly lower than the peak values of 2022, when they reached 147 thousand barrels per day. This indicates that Iran is seeking more profitable and stable export destinations, reducing its reliance on a single market.
          Iran is not only diversifying the geography of its supplies but also increasing its oil production. According to OPEC data, in 2024, oil production in Iran exceeded 3.2 million barrels per day, the highest figure since 2018. Iranian oil exports also reached new highs, stabilizing at around 1.5 million barrels per day.
          These figures highlight the importance of oil to the Iranian economy, which continues to be the main source of income for the country. In an effort to bypass U.S. sanctions imposed by former President Donald Trump in 2018, Iran uses complex schemes to rebrand oil destined for China, labeling it as oil from other countries such as Malaysia, Oman, or the UAE.
          The activation of Iranian exports could have a significant impact on the global oil market, causing price fluctuations and altering the balance of supply and demand. In these circumstances, other oil-producing countries are forced to take into account Iran's increased activity and its strategy to expand markets.
          The ongoing increase in production and export of oil makes Iran one of the key players in the global oil market. This strategy, aimed at maintaining and increasing revenue, is crucial for the Iranian economy, especially under strict international sanctions. However, Iran's active attempts to bypass sanctions create both new opportunities and risks for the country and its partners.
          On the one hand, Iran's success in finding new markets and circumventing sanctions strengthens its economic stability and enhances its negotiating position with the international community. On the other hand, such actions could lead to increased international pressure, including tighter sanctions or the imposition of additional restrictions by the United States and its allies. This, in turn, could negatively impact Iran's trading partners, who may face legal and economic consequences for cooperating with it.
          Furthermore, the expansion of Iran's supply geography and increased production could shift the balance in the global oil market, potentially causing price fluctuations and creating new uncertainties for global energy policy. In this context, Iran's strategy requires constant analysis and flexibility to cope with new challenges and seize emerging opportunities. The international community, in turn, will need to closely monitor Iran's actions and respond to them to avoid potential negative consequences for the global economy and stability.

          Source: NEWS.AZ

          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
          Add to Favorites
          Share

          Take Five: Cruel Summer

          Cohen

          Economic

          Central Bank

          Global markets are having a torrid time of late as U.S. recession fears creep back in and the effects of the yen's sudden surge ripple out.
          U.S. inflation numbers, the latest Japanese economic data and a slew of UK data could give investors a fresh steer.
          Here's your guide to the week ahead in financial markets from Ira Iosebashvili in New York, Rae Wee in Singapore and Dhara Ranasinghe, Samuel Indyk and Amanda Cooper in London.

          1/ Summer Chill, No Way

          Investors should have learned by now that there's no such thing as a "quiet" summer in markets.
          A year ago, Treasury yields rose sharply on worries about the U.S. fiscal outlook. The summer before, inflation and rate hike fears jolted markets.
          Last Monday's meltdown saw Japan's second-biggest stock crash and the largest ever intraday jump in Wall Street's most-watched gauge of investor anxiety, the VIX. That means the coming days will be tinged with nervousness, even if there are nascent signs of recovery.
          Focus is on just how much more of an unwinding of so-called yen carry trades, seen as one reason behind the rout, is left and whether the pricing-in of aggressive U.S. rate cuts are justified by upcoming data.
          And with concerns about a broader Middle East conflict and a U.S. election looming, volatility is unlikely to disappear soon.

          Take Five: Cruel Summer_12/ Ready For More?

          Investors are now bracing for Wednesday's U.S. consumer price data for a read on how inflation is faring in the world’s largest economy amid recent signs that growth is wobbling.
          Market hopes of an economic soft landing have been shaken by recent weak data, including news of a rapid down-shift in the jobs market. The slowdown fears have coalesced with the unwinding of a global carry trade to deliver markets a wallop.
          Some analysts believe recession worries are premature.
          Economists polled by Reuters expect both headline and core consumer prices rose 0.2% in July from a month earlier.
          A number that shows only modest cooling could allay fears that the Federal Reserve has sent the economy into a tailspin by leaving rates elevated for too long. But a weak report could bolster recession worries, potentially sparking fresh market volatility.Take Five: Cruel Summer_2

          3/ Disenchantment

          Japan reports preliminary second-quarter growth figures on Thursday, at a time where some analysts have critiqued the Bank of Japan's (BOJ) recent rate hike as a policy misstep that triggered the brutal selloff in stocks.
          To be sure, the connection isn't quite so straightforward.
          The BOJ's hike sparked a resurgence in the yen and extended an unwinding of the hugely popular yen carry trade, which in turn sent investors de-leveraging and shedding their stock holdings to cut losses.
          So should Thursday's data point to a brighter outlook, Japanese policymakers can finally breathe a sigh of relief. A downside miss and they'd have to find more reasons to justify July's hike.
          It's yet another busy week in Asia-Pacific, with a New Zealand rate decision due on Wednesday, alongside a slew of data from China.Take Five: Cruel Summer_3

          4/ Delicate Balance

          After July's finely balanced decision to cut UK rates to 5.0%, the Bank of England will have a new set of data points to go through that might help determine what the coming few months look like for monetary policy.
          Consumer inflation, including for the still-hot services sector, as well as second-quarter GDP and retail sales, are all in the mix.
          Right now, markets expect rates to fall by a percentage point over the coming nine months.
          But given how close July's decision was, UK assets are likely to be extra sensitive to anything that might suggest the BoE has to deviate from that expected path. Sterling is looking fragile and UK equities have seen nothing but weekly outflows for four straight months, according to LSEG/Lipper data.Take Five: Cruel Summer_4

          5/ Europe's Silver Lining

          There's a silver lining for European shares, down roughly 5% so far this month, and that's corporate profits, with earnings set to grow for the first time in five quarters.
          According to LSEG I/B/E/S data, Q2 earnings are expected to have increased 3.8% from the same period last year, the first quarterly rise since the first quarter of 2021. Almost 56% of companies have reported results that beat analyst estimates.
          For sure, there are more tests ahead. Switzerland's largest bank UBS reports earnings on Wednesday, while it's a big week for the insurance sector, with Hannover Re, Aviva, NN Group and Admiral set to report.
          Overall, the Q2 earnings season suggests signs of a consumer slowdown, but strong growth in financials, energy and utilities
          sectors have helped offset weakness elsewhere.Take Five: Cruel Summer_5

          Source: Reuters

          To stay updated on all economic events of today, please check out our Economic calendar
          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
          Add to Favorites
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          U.S. Inflation Likely Held Steady in July

          Samantha Luan

          Central Bank

          Economic

          After a larger-than-expected increase in the unemployment rate and softening in the manufacturing sector a week ago heightened concerns that the Federal Reserve may need to respond with more aggressive interest rate cuts than previously thought.
          Economic data since then have somewhat calmed concerns with the U.S. services purchasing managers index pointing to further expansion and initial jobless claims edging lower in the past week. Still, we expect further signs of easing inflation in July. We forecast headline price growth held at 3% on an annual basis but with a second straight small 0.1% monthly increase in core (excluding food and energy) prices. That should reassure the Fed that those annual rates will continue to move lower.
          In June, the Fed’s “supercore” (core services ex-rent) measure posted its lowest reading on a three-month annualized basis since October 2021 at 1.3%. The breadth of inflationary pressures has narrowed in recent months and the share of products seeing inflation above 5% has returned to pre-pandemic levels. Home rents continue to account for a disproportionate share of the remaining annual price growth. But, it is slowing as the impact of earlier easing in market rent increases eventually passes through to lease agreements.
          U.S. economic growth (or inflation) numbers haven’t hit a level yet that would push Fed officials to panic. But, it is becoming increasingly difficult to justify interest rates more than 200 basis points above the Fed’s own estimate of the long-run “neutral” rate. Evidence is building that broader economic conditions have already normalized and inflation is more likely to drift lower. Our base case assumption is that the Fed will cut the fed funds target range by 25 basis points in September and risks of a larger cut are contingent on further downside in economic growth or inflation surprises.U.S. Inflation Likely Held Steady in July_1

          Week ahead data watch

          According to StatCan’s early indicator, core wholesales sales were down 0.6% in June. Much of that weakness came from the sales decline in the motor vehicle and motor vehicle parts and accessories subsector, as well as the food, beverage, and tobacco subsector.We expect manufacturing sales to drop by 2.6% in June, in line with StatCan’s prelim estimates, driven by lower sales in the chemical product and transportation equipment subsectors.
          Canadian housing starts likely came in at 264K in July. That would be up 9.2% from June to reverse the 8.8% decline the prior month. Building permits trended higher during recent months, with the three-month rolling average value increased from 257K in March to 286K in May.
          U.S. retail sales are likely little changed from last month. Higher auto sales and a price-related sales growth at gas stations were offsetting by the decline in control sales.U.S. Inflation Likely Held Steady in July_2

          Source:RBC Financial Group

          To stay updated on all economic events of today, please check out our Economic calendar
          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
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          Pound to Dollar Week Ahead Forecast: US Election Polls, CPI Aid Recovery

          Warren Takunda

          Economic

          GBP/USD steadied atop its 200-day moving average at 1.2661 last week before paring some of its recent losses but better risk appetite in global markets, the latest US election polls and the consensus outlook for inflation on both sides of the Atlantic are among the factors that could help lift it further ahead.
          “Kamala Harris leads Donald Trump in three key states—Michigan, Pennsylvania and Wisconsin—according to a new New York Times/Siena College poll. The betting markets currently imply probabilities of an election win as follows: Harris at 52%, Trump at 45%,” said Alessio Farhadi, co-founder at Speevr Intelligence.
          “Recent trends in surveys have been favorable to Harris across a broad category of voter demographics, not just the young. It was agreed with our GOP strategist friends/partners that a +5% increase for Harris in national polls is a soft trigger to panic,” he added in a Friday research briefing.
          Pound to Dollar Week Ahead Forecast: US Election Polls, CPI Aid Recovery_1

          Above: Pound to Dollar rate at daily intervals with Fibonacci retracements of July rally, 200-day moving average, and black trend lines denoting a narrowing symmetric triangle indicate possible areas of technical support. 50-day average and Fibonacci retracements of July downtrend highlight possible resistances.

          Democratic Party presidential candidate Kamala Hariss has turned the tables on former President Donald Trump in many recent opinion polls, which is undermining one important source of support for the US dollar and its outlook into year-end because Trump’s protectionist trade policy agenda and trigger happy use of tariffs is outright bullish for business investment, production, employment and GDP in the US.
          However, any more immediate boost for GBP/USD would be likely to come from inflation on both sides of the Atlantic on Wednesday, in part because the ongoing disinflation process in the US should see markets continue to bet that the Federal Reserve will cut interest rates by as much as 100 basis points by year-end, weighing on the Dollar. Meanwhile, UK inflation poses asymmetric upside risk to Sterling.
          “The June CPI report brought welcome news of slowing inflation, with core CPI rising by a mere 0.06% m/m, marking the smallest increase since January 2021. While we expect a bit of a firmer report in July, we still expect it to be “very good” in the eyes of Fed policymakers,” BNP Paribas economists said on Friday.
          Consensus sees US inflation rising 0.2% month-on-month when data for July is released on Wednesday, which is expected to pull the annual inflation rate down to 2.9%, from 3% in June. This keeps the US disinflation process intact and should weigh on the Dollar because it has a loose negative correlation with inflation.
          Pound to Dollar Week Ahead Forecast: US Election Polls, CPI Aid Recovery_2

          Above: Quantitative model estimates of possible ranges for the week. Source: Pound Sterling Live.

          UK inflation, on the other hand, is seen rising to 2.3% annually in July after remaining at the 2% target for a second consecutive month in June. This is potentially bullish for GBP/USD in the short-term because, rightly or wrongly, it could lead the market to expect that interest rates will remain higher for longer than otherwise.
          “While headline inflation has been at 2% for 2 consecutive months, the BoE itself forecasts a rise to 2.7% by the end of the year before a return to target in 2026,” BCA Research strategists said on Friday.
          However, the Pound to Dollar rate has been negatively correlated with the twists and turns of the inflation cycle since at least January 2021, which implies that Sterling would also have scope to rise in the latter half of the week if inflation surprises on the downside of expectations.
          Disinflation on both sides of the Atlantic would imply scope for GBP/USD to further close the gap between itself and fair value, which is estimated to be around 1.3796, up from around 1.3515 at the beginning of the year. The author’s fair value model uses inflation, interest rates and the cross-currency differentials between both to estimate where currencies should trade as inflation rises and falls.
          Above: Pound to Dollar rate shown at weekly intervals with 50-week moving average (blue) and upper bound of narrowing symmetric triangle indicating possible areas of technical support. 200-week average(black) indicates possible short-term technical resistance.

          Source: Poundsterlinglive

          To stay updated on all economic events of today, please check out our Economic calendar
          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
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          Research Japan: Hawkish BoJ Keen on More Hikes

          Danske Bank

          Central Bank

          Forex

          Political

          The rate hike on 31 July was pivotal for how we see the Bank of Japan (BoJ) moving forward. On the press conference following the meeting, Governor Ueda had turned much more hawkish and the building of an economic momentum fostering 2% selfsustained inflation no longer seems to be the only thing that matters. Instead, the yen has taken centre stage.
          Earlier, FX moves was just one of many parameters, the BoJ monitored when gauging inflation momentum and it was never the key factor. An obvious example of this was the Friday 26 April policy meeting, when a dovish governor Ueda did not pay much attention to a very weak yen. As a result, USD/JPY tested 160 the following Monday and the Ministry of Finance ordered the BoJ to step in to prop up the yen. Now Ueda says, “FX moves are more likely to affect inflation than before”.
          So why this turnaround? The BoJ has intervened for USD161 billion since they stepped in for the first time in September 2022. It is a costly affair to defend the yen and intervention was probably never meant to be a long-term solution.
          The hawkish turnaround should perhaps also be viewed in the light of a very low approval rating for PM Kishida and his cabinet. Just 25% approved in August, below the so-called danger level of 30%, an uncomfortable situation for Kishida considering recent history and the upcoming Liberal Democratic Party leadership election in September. Excluding Shinzo Abe’s eight-year reign from 2012-2020, the last seven prime ministers have only had about one year in power.
          Research Japan: Hawkish BoJ Keen on More Hikes_1
          A very weak currency is usually not popular with the public and in Japan it creates quite visible inflation due to the status as a major energy importer.
          Gasoline for instance costs JPY175 per litre now, which is about JPY25-30 more than pre-pandemic levels. That is a big price increase in 4-5 years. Back in May, a poll from the private think tank, Teikoku Databank, showed 64% of companies see the weak yen as having a negative impact on their profits. Afterall, most Japanese companies are not in a position to exploit the advantages of a weak currency on export markets but only experience the flip side, which is higher import costs. About half of the respondents saw USD/JPY at 110-120 as an appropriate level.
          Largely, a weak currency benefits major exporters at the expense of consumers. That process can create inflation but will be painful for consumers until business profits are passed on to employees. We have seen the beginning of that process with the spring wage increases and real earnings recovered most of the lost purchasing power from 2021, in Q2. A lot of the June pay increases are one-off payments, though, and growth in real contractual cash earnings remains modest. The reality for most consumers is still that much of their purchasing power has been eroded and that is also key to understand why real household spending was still down 1.4% yoy in June.Research Japan: Hawkish BoJ Keen on More Hikes_2Research Japan: Hawkish BoJ Keen on More Hikes_3
          If the long-term goal to sustainably reach the inflation target was the only game in town, we think this would bode for a cautious approach, and hiking rates again only when private spending shows signs of picking up. It seems, however, that the BoJ has come under pressure to incorporate the yen more explicitly in its policy decisions.
          Even if household spending shows only modest improvement, we expect the BoJ to hike by another 25 bps this year followed by another 25bps in Q1 and Q2. Given the recent global, and particularly Japanese, market turbulence, we expect the BoJ will be a bit more cautious at the fall policy meetings, though. This is based on our expectation that investors’ Fed pricing is too aggressive and US treasury yields will trade higher again, adding some renewed headwinds for the yen.
          Research Japan: Hawkish BoJ Keen on More Hikes_4

          US outlook remains key for the yen

          As mentioned above, USD/JPY has experienced some extreme swings over the summer, resulting in notable JPY appreciation. Since 1 July, the JPY has strengthened by around 10% against the USD, pushing USD/JPY below 150.
          Several factors have supported the Japanese currency, including a massive unwinding of carry trades, lower US rates, declining oil prices, more strategic Japanese FX intervention, and a hawkish hike from the BoJ.
          The prospect of narrowing rate differentials between Japan and other G10 economies is currently a significant tailwind for the JPY, making it the clear outperformer in the G10 space. It seems that global factors have a greater influence on the JPY than domestic developments in Japan. Consequently, whether the BoJ hikes 1-3 more times over the coming year may not impact USD/JPY as much as changes in US yields or oil prices.
          We believe there is further room for decline in USD/JPY over the strategic horizon and remain bearish on the cross. If we are heading for more volatile times, the carry trade will lose its attractiveness, as evidenced by the halving of short JPY positions in July. Additionally, the tail risk of a US recession, which could force the Fed to lower rates quickly and aggressively, might prompt USD/JPY to decline sharply, even if the BoJ stops further hikes.
          However, in the near term, with the recent strong rally, we could see a temporary reversal as we expect the dovish repricing of the Fed to reverse. With USD/JPY having already dipped to 141.70 last week before bouncing back above 145.00, we suspect the market will remain in “sell rallies” mode if there is a significant bounce, even if risk assets manage to sustain a rebound. Overall, we see USD/JPY declining below 145 on a 12-month horizon.Research Japan: Hawkish BoJ Keen on More Hikes_5

          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
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          Iron Ore Outlook Dims as China Inventories, Steel Output Fade

          Owen Li

          Commodity

          The price of iron ore has dropped for a sixth consecutive week as China's steel sector continues to struggle and port inventories of the raw material stop rising.
          Singapore Exchange futures ended at $101.49 a metric ton on Aug. 9, up a touch from the four-month closing low of $100.14 the previous day.
          The benchmark contract has declined every week since July 5 and is down 29% from its peak so far in 2024 of $143.60 a ton, reached in the first week of the year.
          While the declining price is not quite a capitulation, it does show market sentiment has shifted away from optimism that Beijing's efforts to boost the beleaguered construction sector would boost steel demand, to the reality that steel mills are struggling for profits and sales.
          Recent price moves and data on China's steel sector, which accounts for just over half of global output, have been bearish.
          Benchmark Shanghai steel rebar contracts ended last week at 3,286 yuan ($458.55) a ton, the lowest close since October 2020, and they are now down 20% since the start of the year.
          The China Iron and Steel Association said crude steel output at its members' mills was 1.9735 million tons per day in the period from July 21 to 31, down 8.1% from the prior 10-day period, with the industry association blaming soft prices.
          Official steel production data for July is expected this week, but is unlikely to alter the declining trend seen so far in 2024, with National Bureau of Statistics data showing crude steel output of 530.7 million tons in the first half of this year was down 1.1% from the corresponding 2023 period.
          China's steel purchasing managers' index fell by 5.3 points to a one-year low of 42.5 points in July, substantially below the 50 level that demarcates expansion from contraction, data from the China Steel Logistics Professional Committee showed.

          Iron Ore Imports

          While steel's woes have weighed on iron ore prices, so far this year import volumes have held up fairly well.
          This has largely been driven by restocking with port inventories monitored by consultants SteelHome rising from a seven-year low of 104.9 million tons in October to a 27-month high of 151.8 million in the week to July 26.
          In the two weeks since, stockpiles have eased slightly to 150.4 million tons in the seven days to Aug. 9, suggesting that inventory restocking may be largely complete.
          It is also worth noting that China's iron ore imports rose 6.7% to 713.77 million tons in the first seven months of the year compared to the same period in 2023.
          This was an increase of 44.31 million tons, a figure close to the increase of 46.9 million in port inventories since the October low.
          It appears that steel mills and traders have taken advantage of the declining trend in iron ore prices to restore inventories, but now that they are at relatively high levels, the question is whether there is any appetite to continue adding to them.
          It seems that August's iron ore imports will remain healthy, with commodity analysts Kpler tracking 97 million tons so far, a figure likely to rise before the end of the month as more cargoes are assessed.
          July's official imports were 102.81 million tons, and the trend so far this year has seen imports anchored in a narrow range either side of 100 million.
          But with steel output declining and the full year unlikely to match last year's 1.02 billion tons, it is hard to be bullish on iron ore import volumes and prices.

          Source: Reuters

          Risk Warnings and Disclaimers
          You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.
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