DXY is breaking down with inflation:
AUD fell anyway:
North Asia is mixed:
Oil and gold soft:
Metals too:
Miners have have fallen down the bottomless shaft:
EM meh:
Junk is back:
As yields confirm US inflation is beaten:
Stocks are jumpy:
US inflation is beaten. Goldman:
July core CPI rose 0.17% month-over-month, roughly in line with expectations.
The composition was mixed, as large declines in the volatile used cars and airfares components were offset by above-trend increases in the car insurance and rent components.
Non-housing services prices increased 0.21%.
Based on details of the CPI and PPI reports, we estimate that the core PCE price index rose 0.14% in July.
With OER set to fall much further, the Fed has won, and rate cuts will begin in September. I expect 25bps in every meeting into next year.
This is short-term bearish DXY but AUD fell anyway. I can only put that down the terrible Chinese credit data and the big break lower in iron ore.
The Aussie terms of trade are a major input in the currency and the future is bleak:
I’m still selling AUD rallies.
