Daily Market Commentary 30th August 2022

US equity markets attempted to stabilise following Friday’s rout. The Fed Chairman’s address to the Jackson Hole Economic Symposium, triggered a major sell-off on equity markets, reinforcing the Fed’s commitment to combating inflation through tight monetary policy. Powell emphasised that the US economy would experience ‘some pain ahead’, which was enough to trigger a collapse in equities. The markets were hoping that recent easing in inflation pressure, would result in a ‘peak inflation’ scenario and the Fed’s providing a more optimistic future. US Bond Yields continued to rise while the US Dollar stabilised. The EUR attempted to regain ground, flirting with parity, while the Yen crashed to 139.00

Australian Retail Sales managed to post positive gains, as the AUD also looked to regain 0.6900, while the NZD edged up to 0.6150. Australia will release Building Permits data, which may indicate tightening in the construction industry, while international markets will focus on inflation and monetary policy. The energy crises enveloping Britain is also crippling Europe and this will only deteriorate as the seasons roll towards winter.