HALISTER1: U.S. ECO PREVIEW: GDP, Trade, Wholesale Data Due in 5 Minutes

U.S. ECO PREVIEW: GDP, Trade, Wholesale Data Due in 5 Minutes

(Bloomberg) -- Revised 3Q gross domestic product seen at +1.1% vs preliminary +1.2% (forecast range +0.9% to +2.8%); data track value of all goods and services produced in U.S.
  • Advance merchandise trade balance seen at -$63b in July vs - $64.5b in June (forecast range -$59b to -$66b); data on trade in goods and services due Sept. 2
  • Wholesale inventories seen rising 0.1% July after increasing 0.3% in June (forecast range -0.1% to +0.3%); wholesale inventories account for ~30% of total business inventories
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

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UUID: 7947283

HALISTER1: Moody’s Warns Polish Investment Spending at Risk From Politics

Moody’s Warns Polish Investment Spending at Risk From Politics

Alert: HALISTER1
Source: BN (Bloomberg News)

People
Jakub Borowski (Credit Agricole Corporate & Investment Bank SA)
Marco Zaninelli (Moody's Deutschland GmbH)
Marek Belka (National Bank of Poland)
Waldemar Grzegorczyk (Republic of Poland)

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UUID: 7947283

HALISTER1: Generate Coupon Value Via 1-Year Dual Currency Note: Commerzbank

Generate Coupon Value Via 1-Year Dual Currency Note: Commerzbank

(Bloomberg) -- Selling short-expiry currency optionality derived from EUR/USD looks rewarding to enhance coupons of short-term structured notes, Commerzbank strategist Markus Koch writes in client note.
  • Recommends investors buy a dual currency note with a 1-year term, fixed coupon 2.83% p.a. if struck at 1.15 EUR/USD yet with the redemption currency contingent on next year’s fixing
  • Apart from generating a coupon of 2.83%, redemption will be made in the same currency as at issuance (EUR) unless the reference index EUR/USD is fixed above the strike at 1.15
  • Note that with only moderately lower strikes, coupons can be enhanced considerably
  • However, if the currency switch of the notional into USD is triggered, investors’ P&L would be adversely affected
  • While U.S. short rates may outpace the current forward path, the ECB is poised to ease its ultra-expansionary policy even further going into 2017
  • Once Yellen has unveiled her policy views at Jackson Hole, still lower USD rate implieds could be weighing on EUR gamma short-expiry swaptions
    • By contrast, volatility implied by EUR/USD options still trading at attractive levels
Alert: HALISTER1
Source: BFW (Bloomberg First Word)

People
Markus Koch (Commerzbank AG)

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UUID: 7947283