Morning 9-16

News:

  • Fatal crashes of the Boeing 737 Max were caused by a “spectacular” regulatory failure by the FAA and Boeing’s focus on profits, a damning congressional report concludes.
  • Annual inflation rate in the United Kingdom slowed sharply to 0.2% in August from 1% in July and compared to forecasts of a flat reading. It is the lowest reading since December of 2015, amid a big fall in prices in restaurants and cafes, arising from the Eat Out to Help Out Scheme. Other downward contributions came from air fares and clothing.(trading economimcs)
  • Speaker Nancy Pelosi on Tuesday heeded a call from her members to commit to keeping the House in session until there’s a coronavirus relief deal, but the vow does little to break the stalemate in bipartisan negotiations that is at the heart of Democrats’ concerns.(roll call)
  • More politics (Yuck) Negotiations on government funding to avoid partial shutdown starting Oct. 1 have hit a rocky patch over a Democratic push to postpone 2020 census-related deadlines. The dispute was threatening to upend congressional leaders’ aim for a drama-free “clean” stopgap measure (Roll Call)
  • OECD saying that while the Global Economy is still expected shrink this year the slump won’t be as sharp as previously feared (BBG)
  • PBOC: sets USDCNY ref at 6.7825 vs 6.8222 prev, strongest level since May 9 last yr. ….. Strong yuan normally good for Risk
  • Per Bloomberg Global companies have sold $2.61 trillion of notes this year across all currencies surpassing previous years records. Record low rates why not borrow

Markets and Fed:

 Fed meeting today and thus markets sideways. Nothing much expected from meeting today we will see updated macro-Economic projections and likely a small tweak to their policy statement. Unlikely they commit to more QE today and no major new innovations are expected. Press conference will likely see plenty of Questions regarding the New Flexible average inflation targeting which they announced in late August. I will be watching the macro projections to see what the Fed thinks they economy will look like in the short term. Remember that all the volatility happens during press conference  not at the 1:00 announcement.

 Retail sales just released missed expectations both non-store retailers (internet sales) and Department stores were lower the latter dropped from +2% to negative 2.3% M/M but eating and drinking was +4.7% higher. All in all, not a good retail sales number    stocks a bit weaker now Bonds a bit of a better bid. Hurricane sally made landfall near Gulf Shores Alabama as a t category 2 hurricane a bit stronger than expected. This is a slow-moving storm which will Drop plenty of rain on the area. Not much in the way of Energy infrastructure this far east of New Orleans but still needs to be monitored. Crude oil +25 this morning due to a surprise draw down in stocks reported by API. Canadian CPI released this morning   missed consensus and with UK inflation touching lowest since 2015  all central banks have work to do to goose inflation Higher. Now you know why no country wants their currency to strengthen too much vs peers.

Outside of Lumber and maybe hogs  markets are sideways  last few days  lets hope post fed they loosen a little.

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