Ian Reynolds
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Overnight
Economic Indicators Released Friday
Nonfarm Payroll surprised market participants hoping for a weak number after lower than expected ADP and higher Initial Jobless Claims earlier in the weak. It was only slightly higher than economist's expectations, and with downward revisions to previous releases, but still spooked the bond markets with UST10 yields up a massive 10bps.
The low volume retail-only stock markets cheered, with institutions nowhere in sight.
US Equities
Breaking
Trump presses Fed chief Powell to cut interest rate by full point despite strong jobs report [CNBC]
Trump signs proclamation banning travel from 12 countries [Reuters]
Trump: I ’shut down’ Russia’s Nord Stream 2 pipeline [Fox News]
CIVIL WAR
Headlining this week was the very public feud between Musk and Trump:
The Trump-Elon Feud Timeline: Best Buddies Broadcast Their Breakup [Bloomberg]
Musk backs call to impeach Trump, replace him with Vance [TheHill]
Inside the battles that shattered Trump and Musk’s alliance [Washington Post]
Whilst only one battle, this is symptomatic of Trump's polarising effect on influencers and voters alike. And the press as usual are taking their sides against him.
We are witnessing the suicide of a superpower [Washington Post]
The more ineffective his policies and lack of success, and with the spiralling down in US finances, he cannot afford to polarise.
The voters who stunned the world by voting for him must be staggered that he hasn't achieved anything in a 100+ days in office despite thrashing around trying to do everything at once.
- No tariff deals
- Alienation of friends and foes
- Worsening fiscal situation
- No end to wars
- No currency reset
One key perspective was in the UN vote where even USA's staunchest supporter, the UK, voted with the rest of the world, leaving the US and Israel isolated and arguing, if some news channels are to believed.
US vetoes UN Security Council resolution demanding an immediate Gaza ceasefire [Boston Herald]
And we're already seeing capital flows into Europe
Big investors shift away from US markets [FT]
And here is some anecdotal evidence of the lack of tariff progress
Don't be caught in the downdraught, when this thing implodes.
Precious Metals / Commodities
Gold continues higher after a bit of consolidation. Note the increasingly larger green candles, then continuation around the monthly high.
GOLD / USD Monthly
Silver finally got it mojo back and is on it's way to $45 plus.
SILVER / USD Monthly
Oil has been very choppy but viewed from the moon (monthly) the downtrend is intact and price is heading lower.
SPOT BRENT Monthly
Bitcoin (& Crypto)
Big candles for BTC as well as Gold, and consolidation before the run at a blow-off top around September. Note the parabolic nature of the move.
BITCOIN / USD Monthly
FCA to lift ban on crypto ETNs to support UK growth and competitiveness [FCA]
CRE / Banks / CLOs
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CRE getting more press now that bigger players are involved.
Brookfield Office Tower Sells for 42% Less Than 2005 Price [Bloomberg]
San Francisco Office Towers Sell in City’s Biggest Deal Since 2022 [Bloomberg]
United States
US Economic Indicators
US economy still producing contradictory signals does validate Powell's decision to wait and see. By taking a data dependent stance he's painting himself into a corner when the direction finally arrives. And by believing his own dubious data it's doubly dangerous. And Trump is smelling blood in the water.
UST10 yields jumping 10bps on Nonfarm Payroll and such a massive sensitivity to Not Good news, spells danger.
China
China Economic Indicators
With almost zero data points this week, and a holiday, China is keeping firmly under the radar. Some reports of Xi missing in action but we've seen that movie before. However No news is Bad News for China in markets as we're expecting more economic weakness and money printing.
Japan
Japan Economic Indicators
Japanese equity funds log sharpest weekly outflows since 2007 [Reuters]
JGB yields firmly on the up but not as quickly as some had predicted. But this time it's not rate hikes, it's MoF trying to find a yield at which investors will participate. Domestic buyers have taken a battering so they are praying for foreigners to turn up.
Europe
EU Economic Indicators
EU CPI printing below target at 2% had everyone cheering, but the really good news is that the economy is recovering, and has been for some months, and Europe is seeing a resurgence of capital flows away from the US. This story is only just starting.
United Kingdom
UK Economic Indicators
More green shoots for the UK economy but it's pushing house prices up, not investment in the economy.
BoE survey on U.S. tariff impact on UK firms [investing.com]
UK inflation overstated due to government data error, ONS says [FT]
As Ms Reeves tries to tax everyone to death, her job is made more difficult as Gilt yields are the highest since 1996.
Canada
Canada Economic Indicators
Nothing positive economically for Canada this week, and tariff tantrums seem to be at their loudest here.
US jobs at risk due to Trump's steel tariff dispute, Canadian leader says [ABC News]
Canadian rates pushing higher too as the currency appreciates. Markets haven't listened to the dovish pause from Bank of Canada, as more rate cuts are coming for sure.
Canada 10 Year Government Bond Yield Monthly
Australia
Australia Economic Indicators
50bps was on the table at the last RBA meeting but they settled for 25bps. That was a mistake as rates need to be significantly lower now to avoid recession.
A complacent Wonder Down Under is heading for a productivity fail [AFR]
Trump agrees with longtime rival Elizabeth Warren on need to abolish the cap on US debt [USA Today]
EU weighs adding Russia to money laundering ‘grey’ list [FT]
What's Next?
US CPI and PPI firmly on top of the radar this week as markets now not interested in tariff stories unless the result is actually real.
All sensitivity is around long bonds from G7 nations. Markets might hope for rate cuts to support long bond prices but it could well be negative, after all once cuts are priced in, what's left....
This Week's Important Economic Indicators [London time]
![This Week's Important Economic Indicators [London time]](https://vip.suberia.capital/hs-fs/hubfs/08062025/indicators.jpg?width=658&height=433&name=indicators.jpg)
