There was ongoing chatter about the likelihood of a 50bp interest rate cut from the US Federal Reserve’s Federal Open Market Committee (FOMC) on September 18. This weighed on the US dollar during the session here. EUR, GBP and JPY all rose against the USD, albeit in limited ranges.

Activity was limited during the session with China, Japan, and South Korea all closed for holidays. China will remain closed tomorrow, Tuesday.

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That summary doesn’t capture a flow of news and data from the weekend and into the session. The big news was in US politics, where shots were fired ‘in the vicinity’ of ex-President Trump. It appears that Trump’s protective Secret Service detail engaged a suspected shooter, firing shots. Trump was a good distance away and was completely unharmed, thankfully. The FBI is treating the event as an attempted assassination attempt on Trump, the second in 60 days.

Also of note, on Saturday China’s National Bureau of Statistics (NBS) released very poor data for economic activity in August, and for home prices slumping at a more rapid pace in August than in July (July stabilisation measures appear to have dissipated). On the economic data for August (more in the points above):

  • retail sales were very disappointing (consumption remains weak)
  • industrial output growth was the slowest since March (domestic demand remains weak)
  • youth unemployment remained very high, above 17%

As is usually the case the weak data brought calls for increased stimulus. If the pattern of the past couple of years persists any further stimulus will be piecemeal only, though.

On the central bank front, Bank of Canada Governor Macklem was interviewed by the Financial Times. He raised the prospect of quicker cuts ahead, citing the labour market pointing towards downside risks.

USD/JPY remained heavy:

Hourly USDJPY candles wrap 16 September 2024 2