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On September 14th, Iraq announced on the 13th that it would gradually reopen three previously closed border crossings with Iran. These crossings will gradually reopen for passenger crossings and commercial trade activities from the 13th to the 17th. Recently, multiple drones originating from Iraq launched attacks on Saudi Arabias East-West oil pipeline, which Saudi Arabia strongly condemned. On the 12th, Iraq closed several border crossings with Iran and agreed to Irans request to conduct a joint investigation into drone launch platforms discovered near the border.The China Earthquake Networks Center officially measured a 4.1-magnitude earthquake in the sea area of Taitung County, Taiwan, at 06:44 on September 14, with a focal depth of 14 kilometers.1. Monday: ① Data: Canadas August CPI month-on-month rate; Chinas August M2 money supply year-on-year rate (to be determined). ② Holiday: The National Stock Exchange of India is closed for one day. 2. Tuesday: ① Data: Chinas August retail sales of consumer goods year-on-year; Chinas August industrial value-added year-on-year; UKs July three-month ILO unemployment rate; UKs August unemployment rate; UKs August jobless claims; Frances final August CPI month-on-month rate; Germanys September ZEW economic sentiment index; Eurozones September ZEW economic sentiment index; Eurozones July seasonally adjusted trade balance; US ADP employment change week-on-week for the week ending August 29; Canadas July wholesale sales month-on-month rate; US September New York Fed Manufacturing Index; Chinas August total electricity consumption year-on-year; Chinas August total electricity consumption (to be determined). ② Events: The National Energy Administration releases total electricity consumption data around the 15th of each month; the National Bureau of Statistics releases monthly reports on residential sales prices in 70 large and medium-sized cities; the State Council Information Office holds a press conference on the operation of the national economy. 3. Wednesday: ① Data: US API crude oil inventories for the week ending September 11; UK August CPI month-on-month rate, UK August retail price index month-on-month rate; Eurozone July industrial production month-on-month rate; US August retail sales month-on-month rate, US August import price index month-on-month rate, US September NAHB housing market index, US July business inventories month-on-month rate, US EIA crude oil inventories for the week ending September 11, US EIA Cushing, Oklahoma crude oil inventories for the week ending September 11, US EIA strategic petroleum reserves for the week ending September 11. ② Event: European Commission President Ursula von der Leyen delivers her State of the Union address. 4. Thursday: ① Data: US Federal Reserve interest rate decision (upper limit) to September 16; Chinas August SWIFT RMB share in global payments; Switzerlands August trade balance; Eurozones final August CPI year-on-year rate and final August CPI month-on-month rate; UK central bank interest rate decision to September 17; US initial jobless claims for the week ending September 12; US August housing starts (annualized); US August building permits; US September Philadelphia Fed Manufacturing Index; US August pending home sales index (month-on-month); US EIA natural gas storage for the week ending September 11. ② Events: US Securities and Exchange Commission holds a roundtable discussion on 24-hour trading; Bank of Canada releases monetary policy meeting minutes; Federal Reserve FOMC releases interest rate decision and economic projections summary, Federal Reserve Chairman holds monetary policy press conference [simultaneous interpretation]; Bank of England releases interest rate decision and meeting minutes. 5. Friday: ① Data: UK September GfK Consumer Confidence Index; Japan August Core CPI YoY; Germany August PPI MoM; UK August Seasonally Adjusted Retail Sales MoM; Eurozone July Seasonally Adjusted Current Account; US August Industrial Production MoM; US August Conference Board Leading Economic Index MoM; China August Year-to-Date National Power Generation Capacity; China August Year-to-Date National Power Generation Capacity YoY (TBD); Bank of Japan Target Interest Rate to September 18 (TBD). ② Events: RBA Governor Bullock attends hearing; Bank of Japan announces interest rate decision; Bank of Japan Governor Ueda Kazuo holds monetary policy press conference. 6. Saturday: ① Data: US Total Oil Rig Count for the Week Ending September 18. According to sources familiar with the matter, Anthropics gross margin exceeds 80% before including revenue shared with distribution partners such as Amazon and model training costs.According to sources familiar with the matter, Anthropic has informed a small group of shareholders that its adjusted operating profit will be positive for the second consecutive quarter. This figure excludes costs such as share-based compensation.

USD/CHF Continues Fed-Induced Declines Toward 0.9020 Support; Central Banks and US NFP in Focus

Daniel Rogers

Feb 02, 2023 16:13

During Thursday's Asian session, USD/CHF remained depressed at the lowest levels since August 2021 as bears enjoy a three-day slump near 0.9065. The Swiss Franc (CHF) pair extends its losses triggered by the US Federal Reserve as market participants expect the main central bank decision and January employment statistics.

 

The USD/CHF retested a multi-day low the day before in response to dismal US data and the Fed's dovish rate hike.

 

Despite the fact that the Fed matched market expectations by raising the benchmark rate by 0.25 percentage points, the statement that inflation "has eased but remains high" impacted on the U.S. currency.

 

Fed Chair Jerome Powell's statement that "We may pronounce that a deflationary process has begun" contributed to the depreciation of the US usd. In addition, the policymaker acknowledges the need for a rate cut by the end of 2023 if inflation decreases much faster than projected. Powell of the Federal Reserve stated that a couple more rate hikes are still required to achieve this.

 

Elsewhere, the US ISM Manufacturing PMI dropped to its lowest level since June 2020, reaching 47.4 in January compared to the forecasted 48.0 and the prior reading of 48. In addition, the ADP Employment Change dropped to a one-year low with 106K, compared to the 178K market forecast and the upwardly revised previous figure of 253K. In contrast, the number of JOLTS Job Openings grew to 11.01 million in December, exceeding both the average estimate of 10.25 million and the previous figure of 10.44 million.

 

Wall Street soared against this backdrop as 10-year US Treasury yields fell the most in two weeks. Note that benchmark interest rates are licking their wounds near 3.41 percent, while S&P 500 Futures are showing slight increases as of press time.

 

Prior to the monetary policy meetings of the European Central Bank (ECB) and the Bank of England, USD/CHF traders should pay attention to market movements affected by these central banks (BoE). However, significant attention should be paid to Friday's US Employment report. Nonfarm Payrolls (NFP), which is expected to decline to 185K from 223K earlier, will be an important indicator to track.