Daily Market Commentary 24th August 2021

The FDA gave approval for the Pfizer ‘vaccine’ overnight, which boosted market confidence and overwhelmed negative economic data releases. Flash PMI data in Australia, Japan, Europe and the USA was softer and told a story of a slower than expected economic recovery, no doubt over fears of the damage done by a resurgent virus. The FDA approval should green light doubts over the vaccine and increase the uptake. The boost to confidence signalled a retreat of the safe haven US Dollar moves. The EUR rallied strongly to trade 1.1740, despite soft PMI data and sliding Consumer Confidence, while the GBP jumped to 1.3720.

Markets will be dominated by Central Bank speculation this week, as Central Banks gather for the annual Jackson Hole meeting. Fed Chair Jerome Powell is expected to outline tapering plans and any divergence from the narrative will impact equities, bonds and currencies. The AUD regained 0.7200, thanks to the weaker reserve, while the NZD looks to regain 0.6900. NZ Retail Sales today may offer some local interest.