- US June core PCE inflation +4.1% y/y vs +4.2% expected
- Canada GDP for May +0.3% versus +0.3% expected
- US employment costs for Q2 1.0% versus 1.1% expected
- Germany July preliminary CPI +6.2% vs +6.2% y/y expected
- July final UMich US consumer sentiment 71.6 vs 72.6 expected
- Atlanta Fed GDPNow model starts Q3 growth at 3.5%
- Dallas Fed June trimmed mean price index falls to 2.5% m/m annualized versus 3.2% prior
- Former ECB VP says 'no need for more hikes'
- Canadian Q2 GDP is tracking at about 1%
- Baker Hughes weekly US oil rig count -1
Markets:
- Gold up $14 to $1958
- US 10-year yields down 4.9 bps to 3.96%
- WTI crude oil up $0.33 to $80.42
- S&P 500 up 45 points, or 1.0%, to 4608
- GBP leads, JPY lags
The Bank of Japan offered plenty of volatility and drama to wrap up a busy week for central bankers but as the dust settled the market grew comfortable selling the yen. USD/JPY started US trade near 139.00 before finishing near 141.00 after several moves in that wide range in the past 24 hours.
Helping the move were lower yields after a goldilocks US PCE report and falling employment cost index.
Outside of the yen, trading wasn't exactly straightforward as a positive risk trade certainly didn't flow into commodity FX, perhaps owing to domestic concerns and month-end flows. USD/CAD finished slightly higher despite another gain in crude and a rip in equities. AUD/USD tried to mount a comeback in North America but made little progress and finished the day down 0.8% as the market frets about next week's RBA decision.
The euro and pound finished higher but only recovered a portion of the drop a day earlier. The gains came early in Europe and it was mostly sideways in North America with volatility low compared to JPY trades.
Have a great weekend, it was certainly an interesting week. Note that the VIX is down to 13 as the market grows increasingly sanguine.
