- Asian stock markets are relatively buoyant this morning, with most indices holding steady after US stocks continued their rally on Friday. The Nikkei 225 is up 1.2% today, the China A50 is up 0.66%, and the KOSPI is up 0.52%.
- US lawmakers have until September 30 to pass a funding bill to prevent a government shutdown.
- There is also a lot going on in terms of geopolitics. Estonia invoked NATO's Article 4 after three Russian MiG-31 fighter jets entered its airspace on Friday, and Germany scrambled fighter jets to track a Russian aircraft over the Baltic Sea over the weekend.
- The yen is one of the worst performing currencies this morning as the balance of risks shifts from relatively hawkish surprises regarding the BoJ's latest decision to nervousness about the presidential election in Japan. The USD/JPY exchange rate exceeded 148.35. At the same time, the Antipodean currencies and the US dollar are recording the largest gains.
- The positive sentiment on currencies such as the AUD is mainly due to hawkish comments by Governor Bullock, who warned that the economic outlook remains uncertain and that there may be excess demand in the economy, which could be driven by better-than-expected labor market data.
- Moody's rating agency has confirmed Poland's credit rating at an unchanged level of A2/P-1 for long-term and short-term liabilities, respectively, but at the same time changed the outlook from stable to negative.
- The decision to change the outlook to negative reflects a weaker outlook for fiscal indicators and public debt compared to previous expectations. The agency also forecasts significantly higher budget deficits for the general government sector and a delay in gradual fiscal consolidation. The risk stems primarily from the impasse between the government and the president and the likelihood of increased government spending ahead of the 2027 parliamentary elections and beyond.
- In China, the People's Bank of China kept its benchmark interest rates unchanged for the fourth month in a row, leaving the one-year base rate at 3.0% and the five-year rate at 3.5%.
- In the commodities market, we are seeing significant increases in the prices of SILVER (+1.5%) and OIL.WTI (+0.77%). At the same time, NATGAS is not showing any particular trading direction. GOLD is up 0.35% today.
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