ECONOMIC DATA OF THE DAY

Time	CY	Indicator	Forecast	Actual	Previous
09:00	CH	Manufacturing PMI	49.8	50.4	49.9

(Source: FabTrader)

SPEECHES

• No Speech

OVERNIGHT NEWS

• US: 
• ADP Employment numbers rose 177k in August (Exp. 175k) and July was revised up from 179k to 194k.  
• The Chicago Purchasing Manager dropped from 55.8 to 51.5 (Exp. 54.0) due to a drop in new orders. Employment in the area was the only positive and increased to a 16-month high.
• BRAZIL: 
• Brazil confirmed the impeachment of Dilma Rousseff. Vice President Michel Temer, who's been serving as acting leader, was sworn in and is heading to China for the G-20 summit.
• INDIA: 
• India GDP came lower than expected at 7.1% YoY in Q2  From 7.9% in Q1 (Exp. 7.6%) due to a weaker private consumption. The government has given stimulus in the economy by increasing the pay of civil-service employees and a unified sales tax but this will need to be matched by more investments to prevent Inflation to accelerate too fast. 

FOREIGN EXCHANGE (INDICATIVE RATES)

Currency	Last	% Change	Overnight Range
DXY	95.97	0.04%	95.902 – 96.255
EURUSD	1.1157	0.04%	1.1123 – 1.1165
USDJPY	103.27	0.39%	102.91 - 103.53
AUDUSD	0.7525	-0.17%	0.749 – 0.7531
GBPUSD	1.314	0.30%	1.3076 - 1.3158

(Source: FabTrader)

COMMODITIES (INDICATIVE RATES)

Currency	Price USD	% Change	Overnight Range
Gold	1309.71	0.28%	1304.29 - 1316.22
Silver	18.76	0.07%	18.5472 - 18.871
Oil (BRENT)	46.99	3.46%	46.77 - 49.9
Oil (WTI)	44.82	2.88%	44.51 - 46.41

(Source: Bloomberg and Saxo)

COMMODITIES

Precious Metals: Gold continues to move lower on Stops and on expectations that the Fed will raise rates faster than expected. The main data to watch will be NFP tomorrow and a strong number will trigger more stops. A break of the 100d MA at 1296.78 can push back Gold to 1250

Oil: The Energy Information Administration reported that Crude inventories rose 2.28 mio barrels last week which was more than expected and pushed Crude Oil more than 3% lower overnight. On another note, Saudi Arabia won’t boost output to capacity and flood the market, Energy Minister Khalid Al-Falih told Al-Arabiya television as OPEC members plan to meet this month to discuss action to stabilize prices.

FOREX NEWS

• Very quiet day overall with still a slightly biddish tone to the USD. DXY is trading back close to the 200d MA at 96.26 which should be a resistance before the NFP tomorrow. A strong report tomorrow could push it back above like in July for a 97.50 target initially.  
• USDJPY remains very bid since the strong bounce out of the 100 level. With the BOJ meeting date approaching fast, we should see more interest to buy USD calls in the pair. The main resistance at the moment is the 100d MA at 105.44 which was also the start of the break lower on July 29th. 
• AUDUSD now trades close to the 100d MA which should be a small support. The main support being the 200d MA at 0.7384. AUDNZD broke the 1.0400 support and is on its way of the lows of the year at 1.0313. The main interest we had seen in the pair was on the long side so this move lower is potentially triggered by stops from Funds.  
• In Emerging Markets, the choppiness continues in USDKRW which trades again below the 1120 level. USDCNH seems to have fond a good resistance at 6.7000. It will be interesting to see how China will respond to the rhetoric of a too weak currency by the Americans at the G20 meeting.  

 

Oil Gains as Saudis See Steady Output After U.S. Stockpiles Rise

Oil rose after dropping the most in a month as Saudi Arabia said it won’t boost output to capacity and flood a market that’s contending with a global inventory overhang of crude and fuel supplies.
Futures rose as much as 0.7 percent in New York after falling 6.2 percent the previous three sessions. The market is saturated with stored crude and Saudi Arabia doesn’t see a need for the kingdom to produce at full capacity, Energy Minister Khalid Al-Falih told Al-Arabiya television as OPEC members plan to meet this month to discuss action to stabilize prices. U.S. crude inventories increased by 2.28 million barrels last week for a second straight gain, according to the Energy Information Administration.
Oil rose 7.5 percent in August amid speculation that talks in Algiers may lead to an agreement to manage the market. A cap on production would be positive, Al-Falih said in an interview last week, while ruling out an output cut. A freeze deal between members of the Organization of Petroleum Exporting Countries and other producers was proposed in February but a meeting in April ended with no final accord.
“The surplus is still there and that’s enough to keep the price from sustaining any strong rally,” said David Lennox, a resources analyst at Fat Prophets in Sydney. “We have the OPEC talks at the end of September and we’re going to get a lot of speculation driven-volatility leading into that.”
West Texas Intermediate for October delivery advanced as much as 33 cents at $45.03 a barrel on the New York Mercantile Exchange and was at $44.95 at 7:51 a.m. in London. The contract dropped 3.6 percent to $44.70 on Wednesday, the biggest decline since Aug. 1. Total volume traded was 50 percent below the 100-day average.
Read More at bloomberg.com