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Markets wrapped up a significant week on a calm note. The S&P 500 and Nasdaq both gained 0.5%, while in Europe, the Euro Stoxx 50 rose 0.1% and the FTSE 100 increased by 0.3%. Bond yields dropped, with the US 10-year yield down 5bps to 3.94%.
Speaking over the weekend, Fed Governor Bowman, one of the most hawkish FOMC members, noted that she still sees inflation risks and ongoing strength in the labor market. This might make it difficult for her to support rate cuts.
Most economists are predicting three consecutive 25bps rate cuts from the Fed at the September, November, and December meetings, steering clear of the larger 50bp cut that had been widely discussed in the market after recent non-farm payrolls and volatility.
Canada’s recent labor market report presented a mixed picture. Employment unexpectedly dropped by 3,000 in July, mainly due to a decline in part-time jobs. However, the unemployment rate remained steady at 6.4%, slightly below forecasts. The data didn’t alter market expectations that the Bank of Canada will continue with 25bps rate cuts at upcoming meetings for the rest of the year.
In Australia, we’ll have Employment Wages data on Tuesday at 1:30 pm, followed by Employment figures on Thursday at 1:30 pm.
The offshore calendar is quite busy, with several significant US releases: PPI on Wednesday at 12:30 am, CPI on Thursday at 12:30 am, and retail sales on Friday at 12:30 am. Additionally, we’ll see monthly activity indicators from China, UK CPI and labour market data, and Japan’s GDP figures.
Mid market rates.
| Currency Pair | Mid-market rate |
| AUD/USD | 0.6574 |
| AUD/NZD | 1.0961 |
| AUD/JPY | 96.67 |
| AUD/CNY | 4.7163 |
| AUD/EUR | 0.6021 |
| AUD/GBP | 0.5155 |
AUD/USD 24 Hour
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