The Euro strengthened from its lowest levels in nearly a year after Germany’s Finance Minister Wolfgang Schaeuble stated that ECB president Draghis’ comments regarding fiscal policy were “over –interpreted.” The currency’s modest advance comes ahead of tomorrow’s schedule release of German consumer price inflation, which is predicted to bolster the case for added ECB stimulus. The CAD also gained some ground against the USD on news of cross-border M&A (Burger King’s announcement that it agreed to purchase Tim Horton’s Inc.)
Separately, on the political front, Russian President Vladimir Putin stated that talks with his Ukrainian counterpart for a resolution to separatist fighting were “positive.” Additionally, Israel and Hamas have indicated they accepted an Egyptian-brokered cease-fire ending the seven week long conflict in the Gaza Strip.
• French manufacturing confidence was in line with expectations while business confidence came in below expectations.
• German consumer confidence as measured by GfK was worse than expected at 8.6 vs. estimates of 8.9.
• U.S. mortgage applications rose by 2.8% for the week ended August 22nd, better than expected.
• The ECB appointed BlackRock Inc. to serve as an advisor for the development of a program to purchase asset backed securities as a form of quantitative easing.
• The Congressional Budget Office has increased its estimated budget deficit for 2014 due to lower projections for tax receipts as a result of weaker than expected growth in the first half of the year.
08/28 EUR: Economic, Consumer, Industrial, Services Confidence Reports (Aug.)
08/28 USD: 2Q GDP Report, 2nd Revision
08/29 EUR: CPI (Aug.); Unemployment Rate (July)
08/29 CAD: GDP (Q2)
09/01 JPY: Capital Spending (Q2 Y/Y)
09/01 GBP: Money Supply (July)
09/02 EUR: Producer Price Index (July)
09/02 USD: Construction Spending (July)
09/03 EUR: Eurozone PMI (August)
09/03 EUR: Eurozone Retail Sales (July)
2 Year 0.508
3 Year 0.942
5 Year 1.627
10 Year 2.368
30 Year 3.133
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