Risk sentiment has stabilized after being hit hard by Powell’s hawkish Jackson Hole speech last Friday, with Forex markets consolidating and stock markets rising.
- Following the souring of risk sentiment after Fed Chair Powell’s Jackson Hole speech last Friday, sentiment seem to have recovered somewhat, sending stock markets mostly higher and halting the strong advance in the US Dollar. The Nikkei 225 Index is up by more than 1% today, while the S&P 500 Index and the NASDAQ 100 Index are trading above their Monday closes, although only barely.
- The Forex market has been consolidating, with the US Dollar failing to advance. Over the short term, the Euro and the Japanese Yen are strong, while the Australian and New Zealand Dollars are weak. However, despite the pause, the long-term bullish trend in the US Dollar is likely to reassert itself, and it remains valid to look for short trades in the GBP/USD and EUR/USD currency pairs.
- Bitcoin is trading back above the $20k level which it had breached yesterday after finding support at $19,616.
- In the commodity markets, we saw strong rises in a few commodities yesterday: WTI Crude Oil, Gasoline, Wheat, and Corn.
- The Chinese Yuan reached a 2-year low yesterday, but the Chinese government has pushed back hard against the decline, setting a very high fix, and boasting of its strong stance on stimulus to try to stem the decline.
- There will be some key data releases today: German Preliminary CPI (inflation), US CB Consumer Confidence, and US JOLTS Job Openings.
- Daily new coronavirus cases globally dropped last week for the sixth consecutive week.
- It is estimated that 67.6% of the world’s population has received at least one dose of a coronavirus vaccination, while approximately 7.7% of the global population is confirmed to have contracted the virus at some time, although the true number is highly likely to be much larger.
- Total confirmed new coronavirus cases worldwide stand at over 606.6 million with an average case fatality rate of 1.07%.
- The rate of new coronavirus infections appears to now be most significantly increasing in Haiti, Japan, Taiwan, and Russia.