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On August 20, Houthi spokesman Yahya Sarri stated, "The Yemeni armed forces successfully conducted two military operations using two drones. The first operation targeted sensitive Saudi targets at Najran airport, and the second targeted Saudi Aramco facilities in Najran. Both operations successfully achieved their objectives. This operation was a response to Saudi drones violating the airspace of Saada province. The armed forces will continue to defend Yemeni sovereignty, resist any aggression, and resolutely implement this strategic policy."According to Israeli reports, the Israeli Air Force has completed the relocation of a helicopter squadron from Ramon Air Base in the south to David Air Base in Ramat in the north. The IDF stated that this move is to better defend the northern border and to learn from the lessons of the October 7, 2023 attack.Justyna Zabinska-La Monica, senior manager of the Conference Boards Business Cycle Indicators, stated that the economy should continue to expand, but growth is expected to be primarily driven by corporate investment in the artificial intelligence sector, while rising living costs may reduce consumer spending, particularly among low- and middle-income households. The Conference Board continues to forecast U.S. real GDP growth of 1.9% for both 2026 and 2027.Justyna Zabinska-La Monica, Senior Manager of the Business Cycle Indicators at the Conference Board: The U.S. Leading Economic Index rose slightly in July, marking its fourth increase in the past six months. Most sub-indices rose in July, except for consumer expectations, which remained a significant drag on the overall index.The Houthi rebels claimed responsibility for attacks on Saudi Arabias Najran airport and "sensitive" targets belonging to Saudi Aramco in Najran. Saudi Arabia has not yet immediately confirmed this.

AUD/USD falls to 0.68 on dismal Aussie/China statistics and risk aversion

Alina Haynes

Sep 01, 2022 15:16

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As bears cheer on weak Australian statistics and a risk-off mindset on Thursday, the AUD/USD drops to a new 1.5-month low near 0.6800. Yet, adverse concerns about China, its major customer, may also be to blame for the current weakness of the Aussie pair.

 

Caixin Manufacturing PMI in China fell to 49.5 from 50.2 predicted and 50.4 earlier, signaling the steepest decline in activity in three months.

 

In other news, Home Loans in Australia dropped by -7.0% in July, worse than the -3.0% drop forecast and the 3.3% drop seen in June. For the same time period, Investment Lending for Homes fell by -11.2%, compared to a drop of 6.3% in the previous month. It should be noted that contrary to projections of a 1.5% expansion, private capital expenditure in Australia shrank by 0.3% in the second quarter (Q2).

 

The risk premium on 10-year US Treasuries has risen to a two-month high of about 3.21 percent, and the risk premium on 2-year bond coupons has risen to its highest level since at least 2007. The S&P 500 Futures were trading at 3,930, down 0.36 percent intraday, their lowest level since late July as of publishing.

 

Recent market sentiment has been pushed down by worries about another ship blocking the Suez Canal, skepticism about China's covid circumstances, poor data, and conflicts with the United States over Taiwan. The president of Taiwan, Tsai Ing-Wen, has recently expressed an interest in bolstering ties with the United States in the semiconductor industry.

 

In light of the Fed's recent aggressive posture, despite conflicting data, AUD/USD bears are likely to hold control as China-related news is also unfavorable. Before Friday's release of the US Nonfarm Payrolls report, traders may find some diversion in today's release of the US ISM Manufacturing PMI for August, which is expected to be 52.8 from 52.0 before (NFP).

 

If the AUD/USD drops below May's low at 0.6830, the next major support is seen in early July near 0.6760. Alternately, a support-turned-resistance line from early August, near 0.6850, will join the 0.6830 barrier to probe the pair's corrective slide.

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