• Recapping the two China Manufacturing PMIs for August – mixed signals
• Japan Q2 capex recap fuels optimism for a domestic recovery, and case for more BOJ hikes
• China Caixin Manufacturing PMI August 2024: 50.4 (expected 50.0, prior 49.8)
• HSBC with two reasons the USD should strengthen
• Australian job ads down 2.1% m/m in August (prior -2.7%)
• Australian data – Q2 Business Inventories +0.1% (expected -0.1%, prior +1.3%)
• Australian July Building Permits +10.4% m/m (2.5% expected)
• Australia Melbourne Institute Inflation August 2024 -0.1% m/m (prior 0.4%)
• PBOC sets USD/ CNY reference rate for today at 7.1027 (vs. estimate at 7.1030)
• China with harsh words for the European Union – says be fair and objective
• Jibun Bank Japan manufacturing purchasing managers index 49.8 in August (vs. 49.1 prior)
• Japan Q2 business capex +7.4% y/y (vs. expected +9.9%)
• Australia August Manufacturing PMI 48.5 (prior 47.5)
• ICYMI – China’s official August manufacturing PMI fell to its lowest since February
• CME Globex Labor Day holiday hours – open Sunday evening for Tuesday trade date
• Reserve Bank of Australia Governor Bullock is speaking twice in the week ahead
• ICYMI – Goldman Sachs raised their Q3 US GDP estimate to 2.7% (q/q annualized), from 2.5%
• Trade ideas thread – Monday, 2 September, insightful charts, technical analysis, ideas
• Politics – Germany’s far-right party AfD set to win one state election
• Monday morning open levels – indicative forex prices – 02 September 2024
• Newsquawk Week Ahead: US NFP & ISMs; BoC, Canada jobs; Australian GDP; Swiss CPI
• Weekly Market Outlook (02-06 September)
• China August Manufacturing PMI 49.1 (expected 49.5), Services 50.3 (expected 50.0)
• Forexlive Americas FX news wrap: US dollar strengthens despite slightly cooler PCE report

The
swings for USD/JPY continued again today, with the pair heading up to
around 146.60 before dropping back to under 146.00. As I post its
around 145.85.

We
had data from Japan today, a solid result for Q2 Capex, well ahead of
the Q1 result although not by as much as expected. The result is
indicative of a bounce back in domestic demand (driven by business
investment) and provides another plank of support for further Bank of
Japan interest rate hikes to come.

Speaking
of data, we had China’s official PMIs for August published on
Saturday showing manufacturing slipping further into contraction
while services were in expansion. Today, Monday, we also got the
manufacturing PMI from Caixin / S&P Global. This privately
surveyed PMI showed expansion for the manufacturing sector. The
Caixin index tends to focus more on small, export-oriented firms,
suggesting that these smaller manufacturers are showing resilience.
According to Caixin, factory production increased for the 10th
straight month in August, driven by growth in consumer and
intermediate goods sectors. Trading
in the offshore yuan followed a similar pattern to the Yen. USD/CNH
traded
to highs around 7.1080
before
dropping back towards 7.1020.

As
a reminder, today is a US market holiday. US
cash equity markets are closed. The Securities Industry and Financial
Markets Association (SIFMA) is recommending the US Bond market closed
today. FX trade will be much lighter than usual. There is a post with
futures market opening hours above.

This article was written by Eamonn Sheridan at www.forexlive.com.