Talking Points:
• Headlines were full of rumor of Greece seeking a third bailout and reports of a surprise PBoC rate cut
• While the Euro and 'risk trends' moved, neither caught traction for a deep trend
• Moving forward we have both volatility and trend to watch on major scheduled event risk
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Interest rate cuts don't seem to leverage the same intensity of rally that they have in the past. An unexpected rate cut by the People's Bank of China (PBoC) this weekend heartened global equity markets, but there was limited follow through in the bull run. That is something to consider for the upcoming monetary policy decisions this week: the RBA today, BoC tomorrow and ECB and BoE on Thursday. What will their moves generate in terms of price action for their respective currencies - much less global sentiment? That said, we are seeing a return to the more systemic drivers of the market. Risk trends are showing limited conviction. The US rate forecast is drawing an increasingly starker contrast to the moral hazard and status quo in the system. And, China may represent the next phase of global financial concern. We discuss these immediate event risks and the bigger themes in today's Trading Video.
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