Monthly Archives: August 2023

Investor confidence was upbeat yesterday at the beginning of the business week. Without a particularly notable catalyst for the risk-on’ environment, this was reflected in continued gains on equities markets from both sides of the Atlantic.

The large number of central bank speakers who attended the Jackson Hole Economic symposium over the weekend did not provide any surprises or significant new information regarding the prospects for monetary policy for the FX majors to consider.

The major FX pairs therefore open this morning similarly to 24 hours ago. This indicates that the dollar has maintained its competitive advantage over the euro and the pound.

Looking ahead to today’s macro data agenda, the US schedule provides most of the releases. House prices from June, job opportunities from July, and the Conference Board’s index of consumer confidence from August are all included.

Yesterday’s big data highlight was US durable goods orders for July. Headline orders decreased more than expected, by 5.2%, compared to a -4.0% drop predicted.

However, the headline figure can fluctuate from month to month. Meanwhile, ‘core’ orders increased by 0.1%, which was in line with expectations.

The dollar was firmer yesterday, and this has persisted in overnight trading ahead of Fed Chair Powell’s remarks at the Jackson Hole Economic Symposium today. In other currency news, sterling has been under pressure, coinciding with a further decrease in UK yields/interest rates.

Given that the Fed is increasingly heavily reliant on data and makes rate decisions meeting by meeting, he may not provide any firm insight on the US rate future. Today’s conference will also feature remarks from ECB President Lagarde.

The announcement of the August flash PMIs from the US, UK, and Eurozone was the primary subject of yesterday’s macro diary. When compared to expectations throughout those regions, the survey results were disappointing.

The unanticipated contraction in their respective service sectors caused the composite PMIs for the Eurozone and UK to drop back to a contraction territory. despite the fact that the U.S composite PMI came in below expectations, it was still able to stay above the critical 50 breakeven point.

The most recent ECB meeting account and US durable goods for July are on today’s macro calendar. An early update on August retail activity will be provided by the UK CBI Distributive Trades Survey, but the publication is not usually market moving.

Meanwhile, the annual Jackson Hole Symposium, which is hosted by the US Federal Reserve, formally begins today, but Friday will feature important central bank speeches, including those from Fed Chair Powell and ECB President Lagarde.

Yesterday’s macro calendar was lacking data and had no directional impact on markets. The July existing home sales data in the United States was one of the few noteworthy releases. The home market update was weaker than anticipated.

The dollar was seen as having the upper hand in currency markets. Simultaneously, the euro was under slight downward pressure.

Meanwhile, sterling’s recent rise against the dollar came to a halt yesterday, with the GBP/USD pair falling back into the bottom part of the trading range.

Looking ahead to today, we receive the week’s primary data highlight with the release of August flash PMIs from the US, Eurozone, and UK. The survey results are expected to reflect a continuing discrepancy between the contracting manufacturing and growing services sectors.