 Okay. A very good morning, folks. Hope you're doing well. It is Thursday the 14th of October and in the briefing and the outlook for today in this session I'm going to talk about the FOMC minutes that came out last night. We'll talk about some Chinese inflation metrics as well from the APAC session. A couple of Brexit headlines to have a look at as well and then we'll look at the day ahead. There's some economic data to watch and some corporate earnings, some more big banks as well coming out today to follow JP Morgan's numbers yesterday. Just taking a quick look across the charts and we've got a fairly bullish open. The equity index futures as I speak, just printing fresh session highs. The DAC is already up 100 at the moment, moving up towards its R1. This, of course, comes after a positive close on Wall Street. We finished up about 0.3% in the S&P and ASDAQ was a slight outperformer as yields on the benchmark 10-year in the US declined for a second straight day after hitting a four-month high at the start of the week and so that helping the tech sector outperform just a touch and this morning the equity index futures continuing that kind of directional trend for the time being so as you can see here in the S&P just continue to move higher from where we were trading initially after hitting that trough post the US CPI data and really that was a bit of a trigger point from yesterday. CPI of course still very elevated however perhaps not then continuing to surge to the upside and thus fairly in fitting with general market expectations with a lot of the Fed speak, with a lot of the data points that we've been seeing and supply chain issues suggesting that inflation is not transitory and more sticky and so therefore the number didn't come as a great deal of surprise and the fact that it wasn't actually even higher did see then other quite serious moves in the markets which we can look at which was gold seeing one of its biggest advances in seven months the dollar came under after initial strengthening moves in weakness and addixi continues to remain lower this morning so that's helped the major currency pairs just looking at cable here on a 60-minute candlestick you can see we are now trading the futures market a two-week high we've just broken above the high that was seen towards the beginning of the week and we've got insights now the 137 handle the R1 and 13695 training up 38 pips this morning a couple of brexit headlines as well I'll go into in the moment likewise though generally dollar weakness with euro dollar also trading up albeit in a rough area of consolidation at least for the time being really between this area of one 16 handle up to 14 at the high so just keeping an eye on that as it performs through this morning which from a calendar perspective is pretty quiet for UK and Europe elsewhere the oil market in a fairly large range consolidation phase at the moment so not really looking too interesting from a technical perspective at the moment next to resistance there you've got the R1 at 81.29 with the high that was printed back on Tuesday session coming at 81.61 above in the weekly high it's seen on Monday at 82.18 to watch out for today if we continue to trend higher and so let's go straight into some headlines then if you didn't stick around for the FMC minutes I don't blame you we weren't expecting too much as discussed yesterday from that and and that's pretty much what materialized the overall reaction to the minutes was very muted Fed officials the main headline is they broadly agreed last month that they should start reducing the emergency pandemic kind of support to the economy and so i.e. commencement of tapering in mid-November or mid-December amid concerns over inflation officials discussed an illustrative tapering path that was in line with general consensus the path featured monthly reductions in the pace of asset purchases so 10 billion in treasury securities and 5 billion in MBS which that total of 15 is very much in fitting was what we're looking and expecting from that November 3rd announcement the next FMC meeting overnight as well we did have a speaker that came out which was feds bowman bowman is a board member so obviously voting member of the FMC she says she's very comfortable with November taper citing concerns about inflation asset bubbles so very much in fitting from a lot of the Fed speakers that we had the three from yesterday and continue to expect that similar rhetoric to come out from other Fed officials as they continue to speak throughout the rest of today there are a number to look out for moving swiftly on though just having a quick word about overnight in the APAC session one of the things that we did have was the latest inflation metrics coming out of China so factory gate prices grew at the fastest pace in almost 26 years in September potentially adding to global inflation pressure if big if local businesses start passing on higher cost to consumers so a couple of things have a look at here this is looking at then the black line is CPI in China which you can see has been much lower and seeing continued divergence between the blue line which is PPI and actually if you look at this in a slightly different way here's a look at the spread between consumer and producer price inflation so really showing then that divergence where in fact that this level has continued to decline and the gap between producing consumer inflation increased in September to 10 percentage points from 8.7 points in August and that is now the widest level as you can see here since 1993 so the jump in PPI mainly fueled by skyrocketing coal prices and other energy intensive products but as you would very much well imagine and really the big question here is at the moment this has not there's been a kind of a an uncorrelated kind of recent history of the just generally what would be normal theoretical kind of movement that increased producer prices gets filtered down to the consumer that hasn't really happened in China and so at the moment that's that's a potential concern particularly in the economy which is showing signs of slowing at the moment from the rapid pace of growth and expansion that we were seeing in the initial phase of the post-pandemic era but I'd say at this point in time there is no signs showing that that is feeding through just yet but something we'll be looking out for there's a lot of underlying other metrics things like pork prices still which are just coming still lower which is slightly offsetting then things like what otherwise would feed through into food price inflation and and so forth but not too much of a headache I'd say for the time being and if PPI continues to remain elevated it just keeps that general market consensus that perhaps then the PBOC will continue to just provide liquidity with further reserve requirement ratio cuts going further forward in the future this data what does it really mean for right now well it certainly means that inflation quite clearly is going to remain higher for longer and one of the historical big products that benefits from that type of inflationary environment of course is gold and as you can see here just looking at gold over the course of the last several months if not year and looking at the price breakout that we've had yesterday was the biggest advance we've had in gold in seven months and we're training flat at the moment but in close proximity to yesterday's high which is just sub that 1800 psychological level and you can see here going back to to February of this year and then through July on the bounce in late July and then the recovery and then commencement of the dip that we saw in early September 1800s always played a fairly important psychological kind of inflection point for price and so keeping an eye on that as we continue to trade up at these levels otherwise brexit what's the latest there I wouldn't say necessarily that the pounds hugely outperforming on this news again the the currency space just generally has been lifted by the fact of the dollar weakness but something to be aware of the EU is proposing to remove most checks on goods from Britain to Northern Ireland in a bid to ensure smoother trade with the UK which would cut 80% of checks on animal and plant based products as well as half customs paperwork so seems to be a little bit of more positive progress there a three-week deadline for talks on these new proposals is now in play at the moment and the EU brexit commissioner has said though that the EU will not renegotiate the fundamentals of the protocol which keeps Northern Ireland within the single market and here then therein lies the kind of issue as far as Boris Johnson who is likely to reject the terms of the deal because the EU is saying that the protocol which keeps Northern Ireland within the single market policed by the ECJ most importantly and draws a customs border down with the Irish sea and so yeah we continue to monitor this and not expecting any great deal of movement anytime soon as they said there's a three-week deadline to the current talks that are happening we're just keeping you up speed on what the latest is there we had the oil inventories last night obviously a day later than normal given the fact that we had the Columbus Day holiday in the US in the States so we'll have the DOEs at the later time of 4 p.m. this afternoon and the headline crude number was bearish in regard to a billed much larger than expected at 5.2 million expectations were for a bill of 900,000 cushing though the opposite drawdown of 2.3 million gasoline draw of around four and a half million overall terms of impact as far as WCI crude futures is concerned nothing really I would say and I wouldn't really factor this too much into how you'd be looking at initiating any intraday crude strategies this morning but just be mindful of course that you do have that the infantry from the DOEs coming out later just one headline there's obviously tons of stock snooze out there but I just saw this last night VW CEO has warned a delay in shift to electric vehicles could cost some 30,000 jobs according to Reuters sources last night the DAX cash market not open yet but VW indicated up about half percent in pre-market so hasn't really seen too much reaction to this headline that move generally in fitting is what the general index in itself is called to open up following as I mentioned the general positive gains that have been seen overnight following the positive close on Wall Street as far as the calendar is concerned today as I already mentioned pretty quiet for the UK European morning and we've got initial jobless claims happening this afternoon as per usual the PPI final demand numbers for September in the US at the same time 130 the DOE infantry's in the afternoon at four o'clock it's really jam packed though as far as speakers are concerned and so just a quick run through here of what we've got we've already had Bowman as we said so for the Fed first obviously concentrated given generally US time zone speaking Feds Bullard is speaking at 135 Feds Bostick voter at 2 Bostick again at 3 you've then got Barkin voter at 515 London time Feds Daily voter at 6 p.m Feds Williams voter at also 6 and Harker to follow non-voter much later in the evening at 11 p.m so yeah a lot of Fed speak and this isn't unusual we're of course just had the FMC minutes come out we've also we're going into the final run in to what would be a meaningful shift in policy albeit becoming well expected with the taper announcement June in November so I wouldn't really be looking for any real shocks coming out of these officials today and probably towing the same line of the commentary that generally we've been talking about in the last two briefings ECB's Enra speaking this morning Eldersen later late morning as well you've also got Bank of England's Tenreiro who generally sits on the slightly more dovish side speaking at 10 past 11 could be quite an interesting one just given the general more hawkish rhetoric we've had out of the Bank of England to see where her view is sitting at the moment in contrast to her peers on the board and similar case for Catherine Mann who's the new NPC member at the Bank of England she's also going to be speaking as well later on this afternoon at 3.40 which also I'll be quite interested to see just given her disposition sit slightly on the neutral to dovish side from a corporate earnings perspective in in the US and so we had JP yesterday you got Bank of America Wells Fargo City and MS all reporting pre-market today Alcoa is also after market which could be quite interesting given their operations based in the in the metal space and the supply constraints that have been moving obviously significantly commodity prices and that is it so I'll let you guys get on with the session any questions at all feel free to drop me a comment below otherwise I'll catch you guys same time tomorrow thanks very much