From Marc Chandler at Bannockburn Global Forex:
The US dollar is consolidating its pre-weekend surge spurred by the hawkish commentary that Fed Chair Warsh delivered at Jackson Hole. The last time the US two-year and the Dollar Index rose as much as in response to the hawkish hold delivered in the first FOMC meeting Warsh chaired in the middle of June. With the August nonfarm payroll report at the end of this week and the end of next week, we are not yet persuaded a FOMC hike at the conclusion of the next meeting on September 16 is a done deal by any stretch of the imagination. Meanwhile, the first Spanish, French and German CPI underscore expectations for an ECB hike. At the same time, the joint intervention and firm data, including today’s retail sales and industrial production point to a BOJ hike on September 18.
New hostilities in the Middle East have lifted oil prices by around $3 a barrel today. Meanwhile, the US Defense Department’s Office of Strategic Capital reported plans to structure an investment through penny warrants, which will allow the US government to take an equity stake (~35% passive stake in Alejandro Betancourt’s North American Blue Energy Partners) without a significant capital investment that gives is rights to buy 20% of the companies oil production in Venezuela at cost (reported reserves of 65 mln barrels). The significance of this is a major talking point today....
....MUCH MORE
