Economic News, Page

It’s a particularly busy week ahead. The markets will need to monitor updates from the G7 summit, chatter on trade, Brexit and the stats.

Mortgage rates resumed their downward trend, as the U.S – Trade war takes a bigger bite. An escalation in the trade war should deliver more downside.

President Trump lit up the Twitterverse with a series of scathing tweets criticizing the Fed, Jerome Powell and China. But this time, he didn’t stop there, he took action that triggered a steep break in the stock market, while spiking demand for safe-haven assets.

The announcement caught traders off-guard and they responded in textbook fashion by buying safe-haven Treasury bonds, Japanese Yen and gold, while selling higher-yielding U.S. stocks. However, the moves were muted as investors put faith in Powell’s ability to soothe the sudden volatility.

“We can, however, try to look through what may be passing events, focus on how trade developments are affecting the outlook, and adjust policy to promote our objectives,” he added.

Trump and the FED at odds coupled with an escalation in the U.S – China trade war distracted the majors from a better week on the data front.

Dovish Fed cannot save the markets

Futures reverse early gains after China escalates the trade war with new tariffs, Jerome Powell’s speech to the Jackson Hole Symposium is still a threat to market sentiment.

Powell is likely to set the tone in the global stock markets for several weeks when he delivers his speech at the Jackson Hole, Wyoming central bankers’ symposium. Investors are hoping Powell presents a dovish front by signaling a series of rate cuts over the next 12 months.

Boris Johnson returns and having failed to fully push the door open to renegotiations could be in for a tough week ahead…

There are no material stats due out of the Eurozone to distract the majors from today’s FED Chair Powell speech… Expect a strong response.

US manufacturing contracts for the first time since 2009

In the middle of the summer, deputy Prime Minister and Lega party leader Matteo Salvini decided to abruptly put an end to the current coalition government, effectively run by Salvini himself and 5Stars leader Luigi Di Maio.

The traditionally slow month of August has been very tough for traders so far this year.

Global markets turn cautions after FOMC minutes, yield-curve inversion despite better than expected results from the retailers.

It’s been a mixed Asian session this morning as the markets respond to the overnight release of the FOMC meeting minutes.

Traders are blaming a number of factors on the weakness including concerns over U.S.-China trade relations, a potential global recession and political unrest in Hong Kong. Some say weak manufacturing activity in Japan helped turn the intraday trend lower.

Investors treated the Fed minutes as a non-event, choosing instead to shift their focus on Powell’s speech at Jackson Hole on Friday. The muted price action in all the final markets indicates some investor indecision and impending volatility. In other words, investors are keeping their powder dry.

Furthermore, it shows that investors want Federal Reserve Chairman Jerome Powell and the FOMC members to cut very aggressively. Due to the muted reaction in the financial markets, a dovish spin by Powell on Friday should trigger a more volatile reaction in the markets.

After a quiet start to the week, it’s a busy day ahead. On top of the PMIs and ECB minutes, there will also be a reaction to the FOMC minutes…