Daily Market Report 9 Sep
Fed’s Waller calls for September rate cut, Yellen says US economy heading for a soft landing
The Dollar has recovered after the softer US payrolls number saw the greenback being sold off. Federal Reserve Governor Christopher Waller has backed a September rate cut given the cooling in inflation and the slowing labour market. Waller further stated that he was open to larger cuts if upcoming data dictates the need. This brings Wednesday’s US CPI data sharply into focus, with analysts looking for a 2.6% YoY number, down from the previous 2.9%. US Treasury Secretary Janet Yellen still feels that the US economy is heading for a soft landing given the still relatively good state of the economy. Wall Street closed well in the red on Friday due to fears of a US slowdown, but futures have opened in the green this morning. The Dollar currently sits at 1.1076 against the Euro, 1.3117 against the Pound, and 142.93 against the Yen. Japan’s Q2 GDP came out below expectations this morning, while Chinese inflation data was softer than expected. The Rand, which had initially firmed to R17.60 levels in the wake of the US payrolls data, closed softer at R17.85 as the Dollar recovered later in the New York trading session. This morning the Rand has opened in the middle of the recent R17.60/R18.00 trading and we expect this trend to continue for now.
Gold holding just below $2,500 ahead of CPI
Gold is trading just below the $2,500 level as markets await Wednesday’s US inflation data, while Platinum and Palladium, which had closed weaker on Friday, are both showing some decent gains. Brent crude continued to slide on demand concerns on Friday, closing down at $71.06. There has been a small bounce up to $71.95 this morning as traders assess the impact of a possible hurricane approaching the US Gulf Coast.
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