SGD

• Macro divergence. Regional Eurozone inflation positively surprised, while US GDP & ADP employment undershot forecasts. This pushed up the EUR.• AUD volatility. AUD spiked to a ~2-week high overnight before easing back. USD & China trends remain more influential than the local data.• AU inflation. Headline inflation slowed to 4.9%pa. But this was due to volatile items. Higher petrol prices point to a re-acceleration next month. Mixed fortunes across US and European markets overnight, inline with the divergence in the incoming data. European equities slipped back (EuroStoxx50 -0.3%) and bond yields rose (German rates increased ~3bps across the yield...

• Jackson Hole. Chair Powell didn’t deviate much from the script. Fed prepared to tighten further if needed, & will hold rates at a “restrictive level” for some time.• Market swings. A bit of volatility in markets, but with a ‘higher for longer’ view priced in equities reversed course. This gave the AUD a bit of support.• Event risks. AU retail sales (today), the monthly CPI (Weds), China PMIs (Thurs), & US jobs report (Fri) are in focus this week. Markets endured a burst of volatility on Friday as US Fed Chair Powell delivered his much-anticipated Jackson Hole speech. In...

• Mixed signals. European equities rose, but US markets were a bit more cautious. Long-end bond yields eased. A softer EUR supported the USD Index.• AUD base? The consolidation in USD/CNH & firmer base metal prices helped the AUD tick up slightly. Offshore forces will drive the AUD near-term.• Event radar. European/US PMIs (today), trends in China, & speeches by Fed Chair Powell & ECB President Lagarde later this week are in focus. A mixed performance across markets with news flow limited. Bond moves remain in focus. Time will tell but from our perspective there are some tentative signs things...