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Trading was a mixed bag of nuts during the Asian session, with many traders staying in the sidelines ahead of Powell’s Jackson Hole speech.

  • New Zealand trade deficit narrowed from 288M NZD to 143M NZD
  • Japan’s national core CPI (y/y) remains at 0.8% vs. 0.9% expected in July
  • Japan’s service producer price index keeps 1.1% growth rate vs. 1.2% uptick expected in July

Major Events/Reports:

Australia set to have a new PM

Australia’s political scene was under the spotlight again today, this time with the Liberal Party calling for a “spill” of the leadership.

The three-way challenge between Treasurer Scott Morrison, Foreign Minister Julie Bishop, and hard right MP Peter Dutton became a one-on-one battle between Morrison and Dutton. The former had 45 votes against Dutton’s 40.

While Morrison’s win put an end to the latest brouhaha of the Liberal Party, today’s results still show how deeply divided the ruling party is.

And with Turnbull pinky-swearing to resign “not before too long,” the party will lose its one-seat advantage in the House of Representatives. Yipes!

Cautiousness ahead of the weekend

There were no fresh catalysts to rock the Asian markets today, so traders kept on pricing in their disappointment that the U.S. and China added tariffs on each other’s products after all.

It also didn’t help investor confidence that Fed Chairman Powell is scheduled to give a speech in Jackson Hole. While it’s highly unlikely, some analysts are watching out for comments on the Fed’s independence after Trump recently bashed the central bank for its tightening program.

Nikkei took advantage of the low-yielding yen taking hits, while Australia and China’s markets took steps back after this week’s tariff development.

  • Nikkei is up by 0.67% to 22,561.8
  • A SX 200 is down by 0.26% to 6,261.5
  • Shanghai index is down by 0.35% to 2,714.985
  • Hang Seng is down by 0.69% to 27599.5

Commodity prices turned higher, however, with gold taking a breather from its intraweek losses while upcoming U.S. sanctions on Iran are still keeping crude oil prices afloat.

  • Gold is up by 0.16% to $1,187.32
  • Brent crude oil is up by 0.47% to $75.05
  • U.S. WTI is up by 0.62% to $68.24

Major Market Mover(s):

AUD

Australia getting a new PM means less uncertainty for the country’s leadership, something that the Aussie bulls appreciated.

AUD/USD is up by 33 pips (+0.45%) to .7279; AUD/JPY is up by 48 pips (+0.60%) to 81.13; AUD/CHF is up by 32 pips (+0.44%) to .7178; AUD/NZD is up by 39 pips (+0.36%) to 1.0958; EUR/AUD is down by 44 pips (-0.28%) to 1.5874, and GBP/AUD is down by 69 pips (-0.39%) to 1.7603.

JPY

The safe-haven took more hits thanks to a bit of risk appetite in the markets.

USD/JPY is up by 18 pips (+0.17%) to 111.46; EUR/JPY is up by 40 pips (+0.31%) to 128.79; GBP/JPY is up by 30 pips (+0.21%) to 142.81; CHF/JPY is up by 19 pips (+0.17%) to 113.02, and NZD/JPY is up by 20 pips (+0.27%) to 74.03.

EUR

There are no catalysts that directly affected the euro, but the common currency probably found support from an extension of this week’s intraweek trends.

EUR/USD is up by 17 pips (+0.15%) to 1.1555; EUR/GBP is up by 13 pips (+0.13%) to .9018; EUR/CHF is up by 15 pips (+0.13%) to 1.1395; EUR/CAD is up by 29 pips (+0.19%) to 1.5122, and EUR/NZD is up by 11 pips (+0.06%) to 1.7396.

Watch Out For:

  • 6:00 am GMT: Germany’s final GDP (q/q) to remain at 0.5%?
  • 8:30 am GMT: U.K.’s High Street lending (40.6K expected, 40.5K previous)