JASPER’S MARKET SQUAWK 30-08-2023

<h2>Markets Rise on China PBOC Hopes, Falling Yields</h2>
<p>Global equity markets were a sea of green after Tuesday reports that China’s PBOC might cut its RRR, and falling job openings in the US. The 2-year yield returned below 5.0%, with a weaker dollar setting the stage for gold and FX.</p>
<p><img decoding="async" fetchpriority="high" class="alignnone wp-image-25302 size-full" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-77.png" alt="" width="1915" height="914" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-77.png 1915w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-77-300×143.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-77-1024×489.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-77-768×367.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/08/Untitled-design-77-1536×733.png 1536w" sizes="(max-width: 1915px) 100vw, 1915px" /><em><strong>Chart: EURUSD</strong></em></p>
<h2>Key Factors for Today</h2>
<ul>
<li>Markets advance as China’s PBOC hints at rate cut</li>
<li>Job openings hit 28-month low, dollar slump fuels gold rally</li>
<li>German consumer confidence falters, euro strengthens against weak dollar</li>
<li>Kiwi surges 1% despite RBNZ selling currency, eyes set on a 60-cent barrier</li>
<li>BOJ remains committed to easing as yen reverses from new high</li>
</ul>
<h2>JOLTS Lowest in Over 2 Years, Dollar Drag Boosts Gold</h2>
<p>The BLS reported only 8.82M job openings compared to 9.48M expected. The prior month was also revised lower by over 200K. This is the lowest in 28 months, and the job openings to unemployed ratio fell to 1.51, the lowest since September of 2021. The cooling in the labour market supports the narrative of a peak Fed. August Consumer confidence also fell to 106.1, well below the 116.0 prior, and July’s reading was also revised lower. The dollar’s demise led gold higher by 0.91% to $1937 an ounce, leaving behind support at $1925 and opening the door to $1950.</p>
<h2>GER Consumer Confidence Slips, EUR Higher on Weak USD</h2>
<p>GfK Consumer Confidence for Germany was -25.5, below the prior month and expectations that it would rise to -23.0. Meanwhile, Germany’s Chancellor Olaf Sholz announced a 10-point plan to boost the economy, including tax cuts. The eurodollar saw a 0.57% gain to $1.0875 following increased demand at the $1.08 (now) support, with expected resistance higher at $1.0948. Losing the $1.0820 could inspire further bearish price action.</p>
<h2>Kiwi 1% Higher After RBNZ Sells NZD to Build Reserves</h2>
<p>The RBNZ disclosed that it sold a net of NZD3.96B in July to build FX reserves to comply with the new framework agreed earlier in the year. The bank said the sale of its currency is not. intervention. NZD/USD grew over 1% to $0.5971, with bulls targeting the 60-cent cent barrier again as the greenback’s drop was seen as more impactful. New Zealand Building Permits in July came in worse than expected, at -5.2% compared to the 3.4% in the prior month, though, potentially adding to the bullish price action as RBNZ had expressed concerns of an overheated housing market.</p>
<h2>BOJ Insists on Easing, Yen Reverses After Fresh Nov High</h2>
<p>BOJ Board member Naoki Tamura is the latest official from Japan’s central bank to support keeping easing in place. He said he sees inflation slowing in the near term, as well as economic growth overshooting expectations. But he reiterated that uncertainty for the Japanese economy is high. USD/JPY was no exemption to the dollar’s weakness, hitting a fresh November high before turning, though. If 146.55 gives in, it may fuel prices past 147.36. Otherwise, the risk of sliding towards 145 will increase.</p>
<h2>On The Docket</h2>
<ul>
<li>SP Inflation</li>
<li>BOE Consumer Credit</li>
<li>UK Mortgage Approvals, Lending</li>
<li>EA Economic Sentiemtn</li>
<li>GE Inflaton</li>
<li>ADP Employment Change</li>
<li>US GDP Growth</li>
<li>Pending Home Sales</li>
<li>EIA Crude Oil Stocks Change</li>
</ul>
<h2>FX 1-Day Relative Performance (USD)</h2>
<ul>
<li>Aussie and Kiwi 0.05% and 0.29% lower</li>
<li>Euro and Cable 0.22% and 0.19% down</li>
<li>Yen 0.22% lower, Swissy down by 0.16%</li>
<li>Loonie declined by 0.17%</li>
<li>Gold and Silver are down by 0.05% and 0.47%</li>
<li>Crude and Brent up by 0.46 and 0.29%</li>
<li>Natural gas up by 0.38%</li>
</ul>
<p>The post <a rel="nofollow" href="https://www.keytomarkets.com/blog/analysis/jaspers-market-squawk-30-08-2023-25298/">JASPER’S MARKET SQUAWK 30-08-2023</a> appeared first on <a rel="nofollow" href="https://www.keytomarkets.com/blog">Key To Markets Blog</a>.</p>