Morning Call Script - 13 Sept 2023
Overnight asset drivers + the impending data calendar
As we enter a new trading month, @HarksterHQ is happy to announce the evolution of its content offering. Of course, The Morning Hark will continue to arrive in your inbox around 8am London, and we would like to take this opportunity to thank the +16k loyal subscribers for their support. Going forward, we will also be adding Harkster's Mng Call Script. This will focus on the overnight asset drivers and the impending data calendar. It will be particularly useful for those presenting on morning calls on the sell and buy side. Publication Time: 6:30 - 6:45am.
What's Moved:
Second tier data in APAC (Japan PPI, NZ food prices) left the market to consolidate ahead of US CPI
ECB sources story on Reuters "The European Central Bank expects inflation in the 20-nation euro zone to remain above 3% next year, bolstering the case for a tenth consecutive interest rate increase on Thursday, a source with direct knowledge of the discussion told Reuters on Tuesday." .. this has EURUSD at the top of its recent (narrow) range 1.0750-60 on the London open as well as EURGBP clearing 0.8600 ahead of UK GDP at the top of the hour.
FX: The day has finally arrived, are base effects rolling through? Will GS be right and we start to see core inflation trending higher? Is there enough fear in the market of a 'hot' print that we can actually see an inline to softer number take the pressure off the Fed and weigh on USD (rates rally)? Consensus sees headline spiking higher but crucially core maintaining its downwards trajectory.
US Headline Inflation rise from 3.2% to 3.6% (base effects now a supporting factoring having accelerated the disinflation in H1)
MoM is expected at 0.6% ... Unlikely to give the Fed comfort that their fight is done, that we're clearly on our way back to 2% target
Core inflation.. has been sticky but hopefully brings the good news this afternoon with a drop from 4.7% to 4.4% ... crucially MoM stays around 0.2%
Equities: the up/down/up/down cycle continues as the major indices give little guidance and continue their choppy price action following the Apple 15 release event. HSI and CSI 300 down 40bps and 20bps respectively following the negative US close of -1% for Nasdaq.
A Podcast for the commute... MS Thoughts on the Market: US and China on Divergent Paths
The Day Ahead:
GBP (07:00): GDP exp -0.2% vs prior 0.5%
USD (13:30): Core Inflation exp 0.2% MoM (prior 0.2%)
USD (13:30): Headline Inflation exp 0.6% MoM (prior 0.2%)
USD (13:30): Core Inflation exp 4.3% YoY (prior 4.7%)
USD (13:30): Headline Inflation exp 3.6% YoY (prior 3.2%)
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