The dollar holds losses and waits for more job data

APAC equity markets

Equity markets were mixed on Thursday in the Asia-Pacific region. Hong Kong's Hang Seng recorded losses as the NBS manufacturing purchasing managers' index (PMI) remained in contraction territory for a fifth straight month. Non-manufacturing PMI fell to 51 from July's 51.5, led by the continuing fall in services activity.

Japananese industrial production

In Japan, industrial production contracted 2% in July month-over-month (MoM), affected by weakening overseas demand and China's economic slump. Retail sales rose 6.8% in July from a year earlier, beating the market forecast for a 5.4% gain and marking a 17th month of increase.

Bank of Japan

Diverging comments from Bank of Japang (BOJ) board members suggest there is clearly no consensus on how soon the BOJ can scale back its massive monetary stimulus. One of them, Naoki Tamura, said on Wednesday that Japan's inflation was "clearly in sight" of the central bank's target. On Wednesday, another board member, Toyoaki Nakamura, warned that it would be premature to tighten monetary policy.

Recent increases in inflation were mostly driven by higher import costs rather than wage gains, and tightening before rising prices are accompanied by higher import costs rather than wage gains would hurt domestic demand and corporate profits.

Eurozone consumer price index

The consumer price index in the eurozone should decelerate for a fourth consecutive month. Headline consumer price index (CPI) is expected to be 5.1% in August year-on-year (YoY), down from 5.3% in July, a level not seen since January 2022.

JOLT

Some economic data is out in the US. today at 1:30 p.m and the UK should be of interest. Personal income and spending, core personal consumption expenditures (PCE) prices, and initial jobless claims, meaning jobs data is one of the market's main focus this week.

After the fall in the Job Openings and Labor Turnover Survey (JOLT) on Tuesday, the APD survey yesterday showed that employment in the private sector has softened in August. 177,000 jobs created. That is nearly 200,000 fewer than in July. Tomorrow, August non-farm payrolls Economists see 170,000 job creations, and the unemployment rate is forecast to stay at 3.5%.

UBS

Swiss banking giant UBS posted the biggest-ever quarterly profit for a bank in the second quarter as a result of its emergency takeover of Credit Suisse. The Q2 group net profit attributable to shareholders was $28.875 billion vs. analysts' estimates of $33.45 billion, so it was a disappointment, but the sheer size of the quarterly profit was a direct result of the accounting difference between the $3 billion price UBS paid for Credit Suisse and the value of the acquired lender's balance sheet.

In reality, there was a Q2 group negative goodwill of $28.9 billion. UBS confirmed that it would fully integrate the local business of Credit Suisse by next year.

Oil prices

Oil prices were little changed on Wednesday. The Emergency liquidity assistance (ElA) inventories show a substantial drop in crude oil stocks last week, confirming Tuesday's Application Programming Interfaces (API) data. Domestic production remained unchanged at 12.8 million bpd, its highest since March 2020, but strong exports and sustained demand from refineries meant that crude oil inventories fell 10.6 million barrels last week. U.S. gasoline stocks fell by 200,000 barrels, while distillate stockpiles rose by 1.2 million barrels.