MORNING BRIEFING: G20 agree to wait for the recovery before putting an end to stimulus plans.

[RTFX-Trading]

MORNING BRIEFING: G20 agree to wait for the recovery before putting an end to stimulus plans.

What’s new:
United States: Markets closed on Monday (Labor Day).
United States: Unemployment rate highest in 26 years and 216'000 jobs were lost.
IMF: Reviewing its global growth forecasts upwards.
France: Fillon said that the high deficits threaten the French economy.

Today:


Overnight Rates and Indices:
EURUSD: 1.4337 – 1.4301.
USDCHF: 1.0609 – 1.0578.
GBPUSD: 1.6419 – 1.6365.
EURJPY: 133.74 – 132.97.
USDJPY: 93.30 – 92.93.
DowJones: 9'441 +1.03%.
NASDAQ: 2’018 +1.79%.
S&P 500: 1’016 +1.31%.
Nikkei: 10'303 +1.14%.
Shanghai: 2'911 +1.75%.
Gold: $992.25.
Crude Oil: $68.26.
 
Comments:

In the US, the economy lost fewer jobs than expected in August, but unemployment rose to its highest level in 26 years, according to the Labor Department.

Regarding the G20 Finance Ministers meeting, the President of the European Central Bank, Jean-Claude Trichet, has confirmed that the agreement between the 27 major countries is essential as they may set new standards for the global financial industry to prevent a repetition of the worst economic crisis since the Great Depression. Financial firms will introduce a leverage ratio and develop plans to increase the reserves when the economy is robust. The G20 has agreed to wait until the recovery before terminating stimulus. The market reaction so far to G20 is of slight risk appetite; the EURJPY is up almost 1% from Friday night.

This week will be marked by the monetary policy meetings of the Bank of England (BoE), the Reserve Bank of New Zealand (RBNZ) and the Bank of Canada (BoC) which are all expected to keep interest rates unchanged.

Good Day

Emman Xuereb

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