From WSJ-

 WSJ chief economics commentator Greg Ip says the Fed subtly but clearly shifted its priorities away from inflation to employment. Central banks have long operated on the assumption that there is a trade-off between the two. As the unemployment rate drops below some “natural” level, inflation starts to rise, a relationship dubbed the Phillips curve. That means unemployment could be both too high and too low. The new framework implies that unemployment can be too high but never too low.

 From Pantheon Economics “The Fed’s new strategy emphasizes the importance of maximum employment, given low inflation. The presumption of a Phillips Curve link between unemployment and inflation has gone, more or less. The Fed won’t hike until unemployment is back to the cycle lows, unless inflation shoots up (  Emphasis mine).. Another way to look at the new mantra from IFR news Fed will tolerate higher inflation to achieve maximum employment

 Powell also said that FOMC will not rely on just one Inflation Metric to determine level of Inflation a bit of ambiguity gives the Fed plenty of leeway in determining too high or low Inflation

Major News Overnight:

 From IFR news “Public broadcaster NHK reported around 2pm that PM Abe was set to resign(for health reasons). The Nikkei plunged from the 23,315 area to a 22,594 low within a few minutes. The stock index ultimately bounced to finish at 22,882, a net 326 points lower on the day. JGB futures initially popped up to 151.64 on the resignation news and then dived to 151.30 as unwinding of long positions set in. Futures then bounced to the 151.50 area, but the next wave of unwinding came in towards the 3pm close pushing futures down to around 151.40. “

 The JPY +1.17% vs USD, but relatively Flat vs other majors.  DXY, Dollar Index Smacked    -.8%. Trade accordingly Gold, Silver Copper higher Stock steady to higher. Below is Graph of European Covid Cases the trend is not your friend int his case. This hasn’t stopped the Euro from rallying +100 ticks. US yield curve continues to steepen text books will tell us that Higher inflation without worries of fed hiking rates will pressure the Long End, but what do the text books know

 Hurricane Laura Spared the big Texas refineries, possibly some issues  for a handful of Lake Charles ,LA. Refineries and Chemical Plants  Citgo  facility may be shut 4-6 weeks Crude Oil Little changed, Nat gas at Multi- month highs  a bit of technical, Drop in daily  production some of the bigger picture bullish factors.

News:

• -AFP citing Chinese For Ministry: Chinese consumers could boycott Apple if the US bans WeChat
• Pres Trump Acceptance Speech: could impose tariffs on firms that leave the US, could end reliance on China once & for all ; next term we’ll cut taxes & bring jobs back from China https://reut.rs/3gvGiHG
• -Sources: Byte dance have told TikTok engineers to draw up contingency plans in case they need to close their US operation
• WH Economic Advisor Kudlow: Economy Can Continue to Recover Without More Stimulus