NY Open – Central bankers are back
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Quiet start to the week with USD assets drifting amid limited Asia catalysts. China cut the 1y and 5y LPR by 25bps, more dovish than expected, though market focus remained on policy, with the NPC standing committee (typically end-Oct) the next catalyst to watch. RBA Hauser said that “inflation is too high” which is stopping the bank from cutting rates. After hawkish labor data, OIS pricing has now shifted to first cuts from April, which “looks encouraging” to him. ECB hawks Simkus and Kazaks underlined growth risks, though the former said there’s no need yet for cuts larger than 25bps. Data catalysts are light today, Fed’s Logan speaks at 08:55 EDT, followed by Kashkari (13:00) and Schmid (17:05). There’s a heavy G10 speaker schedule throughout this week given major conferences and events, including the IMF/WBF 2024 annual meetings. Brazil watches weekly central bank economist survey data out at 07:25 EDT. We keep an eye on geopolitical headlines, as US envoy Amos Hochstein will be visiting Lebanon today to discuss diplomatic solutions to the conflict.
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