Recoil In Yen Progressing, Greenback Waiting For Payroll Report
Asian stocks have broadly declined, burdening Aussie and Kiwi. Nikkei fell -1.01%, Hong Kong HSI reduced -0.86%, Singapore Strait Times was down -0.75%. China Shanghai SSE had a short breach above 2720 but it then dropped -0.13% to 2700 handle. Dollar is trading as the softest, waiting for the NFP report. Japanese Yen rose to become the firmest. Loonie follows suit. DOW rose 0.08%. NASDAQ declined -0.91%. S&P 500 reduced -0.37%.
Carolyn Wilkins, BoC Senior Deputy Governor, presented “An Update on Canada’s Economic Resilience”. The Governor said: “Our practice is to not incorporate scenarios that have yet to occur, even though they may be the subject of ongoing discussions” And, risks of trade tensions “are not just on the downside”, but “there is some significant upside as well.” She also told this trade situation can become “complex trade-offs for monetary policy.” And in conclusion she delivered: “the bottom line is that Governing Council agreed that the gradual approach we have been following is still appropriate.” Meanwhile, US-Canada talks resumed with no particular concession. The Chapter 19 dispute resolution mechanism is still the most important and controversial topic.
Is Donald Trump attacking Japan? The news broke that WSJ’s James Freeman had this to say about Trump’s policy: “the President sees a problem and even if he wraps up negotiations with our friends in North America and Europe, the trade uncertainty won’t necessarily end.” And, “seems that he is still bothered by the terms of U.S. trade with Japan.” He also told that Trump “described his good relations with the Japanese leadership,” but then added: ‘Of course that will end as soon as I tell them how much they have to pay.'”
Australia AiG performance on construction fell from 52.0 to 51.8 in August. Home loans increased 0.4% mom in July. Japan household spending surged 0.1% yoy. Labor cause earnings were up 1.5% yoy. Today, we’ll get Eurozone Q2 GDP, German trade balance and industrial production, Swiss jobless rate and foreign currency reserves and UK Halifax house price. But, the highlights of the day, and even this week, are US non-farm payroll, unemployment rate and wage growth as well as Canada employment data and Ivey PMI.