Limit Up! 27th August 2025

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Overnight

Economic Indicators Released Overnight

Economic Indicators Released Overnight

Markets showing extreme bubble tendencies as able to ignore all bad news and focus on the only real certainties in life: taxes and QE.

BoJ Core CPI (YoY) comes in a lot lower than expected, US Durable Goods won't make any sense due to tariffs, and US housing comes in lower which we knew anyway.

Equities up 

US Equities

US Equities

RBA Minutes

The Reserve Bank of Australia (RBA) minutes for the August 12, 2025, Monetary Policy Board meeting, released on August 26, 2025, indicate a cautious approach to monetary policy. Key points include:
  • Cash Rate Decision: The Board cut the cash rate by 25 basis points to 3.60%, reflecting a gradual easing strategy.
  • Economic Outlook: Inflation is within the 2–3% target range, expected to hover around 2.5% with temporary increases to 3% due to unwinding electricity rebates. GDP growth is projected to be gradual, driven by private demand, though public demand weakness persists.
  • Global Context: Global economic uncertainty, particularly from U.S. tariffs, is expected to slow growth in major trading partners, with modest impacts on Australia starting late 2025.
  • Labor Market: The labor market remains slightly tight, but conditions are easing, with potential risks to unemployment if participation rates don’t rise.
  • Policy Considerations: The Board debated the pace of rate cuts, with a majority favoring gradual easing to maintain stability, while a minority argued for faster cuts due to downside risks to growth and inflation.
  • Housing and Risks: House price increases align with past easing cycles, and home building is picking up. Risks to forecasts include global trade disruptions and domestic demand recovery strength.
The RBA emphasised a data-dependent approach, with the balance of risks potentially shifting downward if global conditions worsen.

U.S. 2-year Treasury Note Auction

The U.S. 2-year Treasury note auction on August 26, 2025, resulted in a high yield of 3.641%, with a 1.5 basis point stop-through. The auction sold $69 billion in notes, with a bid-to-cover ratio of 2.69, indicating solid demand. Indirect bidders, typically including foreign investors, took 57.09% of the allocation, while direct bidders accounted for 33.16%, and primary dealers received 9.74%.

The strong participation from indirect bidders suggests continued global confidence in U.S. debt despite market tensions.

Breaking

France may need IMF bailout, warns finance minister [Telegraph]

The Big Take Xi Unleashes China’s Biggest Purge of Military Leaders Since Mao [Bloomberg]

French assets hit by prospect of government collapse[FT]

Bitcoin

BTC trying to come back as risk-on sentiment returns. A close above $114,500 is positive and if above $117,500 back to the all time high for a triple top (no such thing).

BITCOIN/USD Daily

BITCOIN/USD Daily

Commodities

Oil back in the bear flag as resistance is strongly rejected. Gold and Silver still constrained but will break soon.

SPOT BRENT Daily

SPOT BRENT Daily

Bonds

UK, France and Germany. Government yields under pressure. 10 year Gilts having yet another attempt to break higher in yield following 30 year last week.

UK 10 Year Government Bond Yield Daily

UK 10 Year Government Bond Yield Daily

Equities

Nothing stops the S&P train as we now have an early trend higher with a higher low.

S&P 500 Daily

S&P 500 Daily

Interesting

Economic Indicators Today

Economic Indicators Today
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