RBA raises rates again

Good morning

In what many will see as a strange decision, the five men arrested on suspicion of potential terrorism at Fairford have been bailed.  Yes, those guys who looked ready to blow up something or someone are back on the streets.  I’m not sure what Trump will make of that giving his comments that they have been following these guys for months and they now have them.  Perhaps these are not the guys Trump is referring to, but I cannot help thinking all is not quite what it seems and there must surely be a lot more to this story. 

RBA did raise rates 25bps earlier this morning, the fourth such rise in the past year which has taken rates to 4.6%.  Further rate rises are not totally out of the question as RBA takes a firm line on inflation but they did express concerns over a possible slowing economy which offered a mildly dovish tone in my eyes despite some seeing a more hawkish outlook.  AUD pushed higher initially but is now lower than pre-RBA levels with GBPAUD up to 1.8950 and AUDNZD down to 1.2355.  Aussie inflation numbers due out overnight could add to recent volatility.

GBP may have gained a little against AUD but it has lost some of yesterday’s gains against USD, now 1.3230 while sitting happily in the mid-1.16’s against EUR.  Elsewhere Japan FinMin Katayama has said the weak yen is problematic and talked again about possible cooperation with the US over the currency level.  USDJPY is 157.30 as I type, GBPJPY 208.25.  In other crosses GBP is 2.3405 and 1.8775 against NZD and CAD.

Elon Musk’s SpaceX launched its huge Starship vehicle into space yesterday where it orbited the earth a couple of time before splashing down in the Pacific.  I watched some of it on the SpaceX live stream and it does make a spectacular sight.  I must go to see a space rocket launch one day.  I think it was a pretty successful trip although did less orbits than had been planned after one of its main engines failed and it did explode on landing.  Impressive stuff though.   SpaceX stock closed lower around $145.50.

Plenty of central bank speakers from BoE, ECB and Fed on the calendar today along with Canadian GDP and the first of the weeks US employment numbers in the form of JOLTS.  This may not be enough to move the markets but Friday’s nonfarms certainly do have and I have seen some trade ideas looking for upside US dollar if the employment data drives Fed rate rise thinking.   UK GDP early tomorrow morning could be of interest if it deviates from the preliminary readings we saw back in August.

-  10.00 EU consumer confidence

-  12.00 ECBs Lagarde speaks

-  12.30 Feds Musalem speaks

-  12.30 ECBs Vujcic speaks

-  13.30 CAD GDP

-  14.00 US house price index

-  14.15 ECBs Cipollone speaks

-  15.00 US consumer confidence, JOLTS

-  16.00 Feds Bowman speaks

-  16.30 BoEs Taylor speaks

-  17.40 Feds Barr speaks

-  18.00 Feds Goolsbee speaks

-  19.00 Feds Williams speaks

-  20.00 Feds Waller speaks

-  00.50 Japan trade

-  02.30 AUS CPI

-  07.00 UK GDP