Russian Ruble Futures Market News and Commentary
The dollar index (DXY00) on Tuesday fell -0.167 (-0.17%). Sep euro-fx futures (E6U9) closed up +0.0014 (+0.12%), and EUR/USD (^EURUSD) rose +0.0022 (+0.20%). Sep yen futures (J6U9) closed up by +0.0026 (+0.27%), and USD/JPY (^USDJPY) fell -0.37 (-0.35%). The dollar index on Tuesday fell back from a 2-week high and moved lower on strength in the yen after U.S./China trade tensions worsened. Trade tensions escalated Tuesday after U.S. Secretary of State Pompeo said that Huawei Technologies is not the only Chinese company that poses risks to the U.S, which suggests the U.S. will blacklist more Chinese companies. Also, President Trump said Tuesday afternoon that he's "not ready to make a deal with China." The yuan on Tuesday Tuesday by -0.14% to 7.0605 yuan/USD, nearing last Tuesday's 11-1/4 year low of 7.0726 yuan/USD. The yuan was undercut by increased US/Chinese trade tensions and by the People's Bank of China (PBOC) announcement of a new one-year benchmark lending rate or Loan Prime Rate (LPR) of 4.25%, 10 bp below the old benchmark rate of 4.35%. The PBOC will set the new LPR on the 20th day of every month. EUR/USD recovered from early losses Tuesday and moved higher on dollar weakness. EUR/USD also found support on Tuesday's economic news that showed the German July PPI rose +0.1% m/m and +1.1% y/y, slightly stronger than expectations of unch m/m and +1.0% y/y, which was hawkish for ECB policy. On the negative side, Eurozone June construction output rose by only +1.0% y/y, the weakest report in 5 months. USD/JPY moved lower Tuesday after a slide in stocks boosted safe-haven demand for the yen.