| Trump says U.S. and China are talking and doing well, a peaceful march in Hong Kong as pro-democracy protesters take to the streets for an 11th weekend, and investors will continue to focus on bond yields. Here's what's moving markets. All Good President Donald Trump said the U.S. is "doing very well with China, and talking!" in a Twitter message sent hours after his top economic adviser laid out a potential timeline for the resumption of substantive trade talks with Beijing. Larry Kudlow earlier said recent phone calls between U.S. and Chinese trade negotiators had been "positive," potentially opening the door to further progress toward a deal. More teleconference meetings with Chinese negotiators are planned over the next week to 10 days, the White House National Economic Council director said on "Fox News Sunday." Hong Kong's Peaceful March Tens of thousands of Hong Kong protesters defied heavy rain to march for an 11th straight weekend, as more moderate leaders sought to reset the pro-democracy movement after violent scenes at the airport last week threatened to sap support among the broader public. The Civil Human Rights Front, which organized the protest, said more than 1.7 million people turned out, making it one of the largest since demonstrations began on June 9. A sea of umbrellas filled Victoria Park in Causeway Bay, with the police estimating a crowd of 128,000 at the height of the gathering, before the group streamed out and marched toward Central, shutting down major boulevards. Markets Open Stocks in Asia are set for gains early Monday following a bounce in U.S. equities as traders await commentary from the Federal Reserve chief. Treasuries recovered from multiyear lows on Friday, after an inversion in the yield curve earlier in the week. The yen and China's yuan were steady early Monday. On the data front this week, minutes of the Fed's July meeting will provide details on the discussions leading to the first interest-rate cut in a decade when they are released on Wednesday. Thursday brings the Bank Indonesia rate decision and press conference with Governor Perry Warjiyo. Kansas City Federal Reserve Bank hosts its annual central banking symposium in Jackson Hole, Wyoming, starting Thursday. Fed chairman Jerome Powell will give remarks on Friday. And Now… Negative Mortgages The world's headlong dash to zero or negative interest rates just passed another milestone: A bank in Denmark is paying homebuyers to take out mortgages. Jyske Bank A/S, Denmark's third-largest lender, announced in early August a mortgage rate of -0.5%, before fees. Years of easing by central banks hacked away at interest rates around the world, distorting the traditional economics of lending and borrowing. This is most pronounced in Europe, where a composite home-loan rate across the euro area fell to 1.65% in June, the lowest since records began in 2000. Here's a snapshot of mortgage rates around the world. Retiring Later Singapore extended support for older workers by raising retirement and re-employment ages and lifting the cut-off for full pension benefits, as the current leadership prepares to hand over to a new generation in coming years. The retirement age will be gradually raised from 62 to 65, and the re-employment age will rise from 67 to 70, Prime Minister Lee Hsien Loong said Sunday in his annual National Day Rally speech. The city-state also will increase pension-contribution rates for workers so that by 2030, any worker age 60 or below will get the full rate, he said. What We've Been Reading This is what's caught our eye over the weekend. And finally, here's what Tracy's interested in this morning It's that time of year again. Jackson Hole, the annual gathering of economic policymakers in Wyoming, starts this week. While recent Jackson Holes haven't had much in the way of actual policy changes, this one could be very different. Markets have been selling off thanks to concerns the U.S. economy sits on the cusp of recession, the Fed faces pressure from Trump to lower rates, and there seems to be growing skepticism of monetary policy's ability to boost inflation at all. Put that all together and we could be in for one of the most important Jackson Hole gatherings in recent history. As if that broad thematic background weren't enough, we also have one very specific and pressing question now facing the Fed. There's been talk of an "emergency rate cut," or one that could be done before the central bank's next official meeting in mid-September. On Friday, St Louis Fed President and uber-dove James Bullard shot the idea down, saying: "The timing is never critical on these things. A couple of weeks one way or another probably doesn't matter." But even if Fed Chair Jerome Powell doesn't use Jackson Hole as an opportunity to surprise the market with an actual rate cut, it seems likely that he'll be under pressure to provide some soothingly dovish words at his speech on Friday — including a potential softening of his "mid-cycle adjustment" thesis. All in all, it looks like this year's Jackson Hole will be much more interesting than usual. You can follow Bloomberg's Tracy Alloway at @tracyalloway. The best in-depth reporting from Asia Pacific and beyond, delivered to your inbox every Friday. Sign up here for The Reading List, a new weekly email coming soon. Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. Learn more. |
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