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Forex market players hit the snooze button in today’s Asian session trading as a lack of catalysts pushed them in the sidelines ahead of an eventful U.S. session.

    • Switzerland’s UBS consumption indicator rises from 1.46 to 1.53 in August
    • China’s industrial profits up by 24% in the year to August vs. 16.5% growth in July
    • Market players trod lightly ahead of bigger events in the U.S. session

Major Events/Reports:

Commodities boost China’s industrial profits

Data from the world’s second largest economy saw industrial company profits rising by 24% from a year earlier in August, higher than July’s 16.5% growth and marks the sharpest increase since 2013.

This also translates to a 21.6% growth since the start of the year, which is faster than the 21.2% growth from January to July.

Apparently, higher oil, steel, and electronics prices boosted profits higher. Heck, the National Bureau of Statistics even said that surging prices made up nearly one-third of the new profits!

A closer look tells us that the mining (+5.9%) and manufacturing (+18.6%) sectors saw improvements from a year earlier, while electricity, gas, and water production (-22.6%) saw declines. In addition, corporate leverage has shown a decline.

Overall the numbers point to progress in taking out overcapacity risks in the economy’s supply side, and suggests that the economy will keep on keepin’ on despite the government’s efforts to crack down on companies’ financial risks.

All eyes on the next trading sessions

With not a lot of new catalysts to price in, forex traders focused on extending the dollar’s gains. See, though Yellen might have been a bit less hawkish yesterday, her bias against moving too slowly policy-wise was enough to fuel the dollar’s run.

Of course, it also doesn’t hurt that Trump and a few Republican leaders are set to announce their long-awaited tax plans later today.

Word around the hood is that they’ll propose a top individual rate of 35% and lower corporate taxes from 35% to 20% but leave Congress the decision of whether they would create a higher tax bracket for top earners.

So far the dollar has responded positively to progress on issues like taxes and infrastructure and it looks like traders are expecting today to be no different.

      • Nikkei, plagued by ex-dividend share price adjustments, is down by 0.36% to 20,258.00;
      • Australia’s A SX 200 is also down by 0.30% to 5,653.70;
      • Hang Seng is up by 0.45% to 27,636.50, and
      • China’s A 50 is down by 0.17% to 11,956.77.

Commodity prices were a little bit more upbeat.

      • Gold is down by 0.31% to $1,297.71 on dollar strength;
      • Copper is up by 0.41% to $2.929;
      • Silver is up by 0.01% to $16.886;
      • Brent crude oil is up by 0.35% to $58.12, and
      • WTI oil is up by $52.13.

Major Market Mover(s):

USD

The Greenback extended its gains as Asian session traders caught up to its U.S. counterparts. Of course, it also doesn’t hurt that traders are expecting Trump’s comments to boost sentiment for the dollar.

USD/JPY rose by another 11 pips (+0.10%) to 112.36;
EUR/USD dipped by a pip after rising to a session high of 1.1796, and
USD/CHF gained 17 pips (+0.18%) to .9702.

Watch Out For:

    • 6:45 am GMT: France’s consumer confidence to remain at 103.0?
    • 7:10 am GMT: ECB’s Daniele Nouy to make a speech in Madrid
    • 7:10 am GMT: ECB’s Daniele Nouy to make a speech in Madrid
    • 10:00 am GMT: U.K.’s CBI distributive trades survey