- Signs of a thaw in US-China trade talks? Presidents Trump and Xi spoke via phone to set up “an extended meeting” at next week’s G20 summit, with trade teams to “begin talks prior” to the meeting.
- Separately, Bloomberg reported that the White House explored demoting Fed Chairman Powell earlier this year, though a spokesman later said it was a “six-month old story.” Traders are looking ahead to tomorrow’s FOMC meeting – see how and why the Fed may look to “set the stage” for a rate cut next month.
- The latest UK Conservative Leadership vote knocked out Dominic Raab ahead of tonight’s televised debate, but Boris Johnson remains the prohibitive favorite with 126 votes. The pound finished in the middle of the major currency pack today.
- Much to the chagrin of President Trump, ECB President Draghi indicated that the central bank would provide additional stimulus (rate cuts?) if growth and inflation data do not improve. The euro was the weakest major currency pair on the day as traders priced in a 10bps cut in September (moved forward from December).
- The New Zealand dollar was the strongest major currency in today’s risk-on trade.
- Oil prices gained 4% on renewed optimism about global growth.
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