US government bonds weaken
Mihir Kapadia, CEO and Founder, Sun Global Investments
The Trump administration threatened to impose further sanctions on China if Beijing doesn't do more to shut down banks and other Chinese firms aiding North Korea. This follows United Nations Security Council approval of new sanctions against North Korea which had to be diluted significantly from the US’s desired proposals in order to win approval from China and Russia.
In the FX markets the yen has retreated this week as safe-haven bids have faded. The euro has topped Y132 for the first time since February 2016. The euro has been rising on the prospects of the European Central Bank signalling some QE tapering measures in October.
Oil prices are little changed in Asia. Yesterday, the American Petroleum Institute's weekly data showed a bigger gain in US inventories of crude. Hurricane Harvey continues to have an impact on the oil market as the spread between WTI and Brent continues to be high. WTI is at $48.19/barrel while November Brent is at $54.17.