Ipek Ozkardeskaya
Swissquote Bank Ltd
The week starts on a mixed note in Asia, after major US indices recorded their best week since last October and boosted appetite in global risk markets. It looks like the mini panic of the beginning of the month has well reversed. The VIX index is back to the pre-panic levels. We don’t have a busy economic calendar this week, but the central bank policies and rate discussions will be on the menu of the week as the annual Jackson Hole meeting will begin on Thursday, Federal Reserve (Fed) Chair Jerome Powell will speak on Friday, and many other central bankers will speak at the event. Price-wise, the US dollar is softer on Monday, the dollar index is testing the August support but the market pricing remains more dovish than what the Fed is set to deliver at the September meeting (with around 30% probability given to a 50bp cut), and also more dovish than what the Fed could deliver for the rest of the year. The Japanese yen, on the other hand, is better bid this morning as the net speculative yen positions turned positive for the first time since March 2021 and big players are increasing bets that the Bank of Japan (BoJ) will continue hiking the rates despite the sharp market reaction.
This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.
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