FX
USD Languishes With Wall Street on Trump
Wall Street slipped overnight after US Trump said he would rather let the government shut down if he does not get his funds for his border wall. Separately, he also said that US will "end up probably terminating NAFTA at some point". That spurred a brief spike in USDMXN in Asian session before the USD retreat pulled the pair lower into NY session. The DXY index gave up all gains yesterday, also weighed by stronger EUR that was buoyed by a series of firmer flash PMI-mfg prints out of the Euro-area.
41st Economic Symposium at Jackson Hole Starts
While the fear of a US government shutdown remains in the backdrop, the 41st Economic Symposium at Jackson Hole starts today. Yellen is supposed to make her speech at 10pm (SGT) tomorrow followed by the widely watched ECB President Mario Draghi's speech at 3am(SGT) on Saturday morning. There is little of note out of the event in the day ahead and we could see more consolidation in FX plays. USDAsians are likely to trade within their well-worn ranges though we note that sentiments in the regional bourses were not affected when Trump made his comments in Asia morning yesterday. Weak USD is likely to cap the USDAsian intra-day action.
Hong Kong Markets Re-open, Eyes on China's Money Market
Markets in Hong Kong resume today after a break because of Typhoon Hato yesterday. The Asian calendar is quiet today. Eyes are on China's onshore money market as overnight repo (volume weighted average price) remains lofty around 2.87%. PBOC has been draining liquidity in the past three sessions, keeping short-term rates supported.
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