Fed speakers diverge in public comments

Stephen Miran, the newly appointed Fed governor, said that he believed the neutral rate of interest was much lower and that he would be “continuing to dissent” with the majority of the FOMC in favouring lower rates. He also noted that he would support moving away from the Fed’s 2% inflation target though it would need to be done only after the Fed got inflation under control. Elsewhere Alberto Musalem of the St Louis Fed said he would only support further cuts if “signs of labour market weakness emerge” while Cleveland Fed president Beth Hammack said that policy was only “very mildly” restrictive.

Tourist arrivals in Türkiye rose by 2.1% y/y in August, an improvement from three months in a row of annual declines. Total arrivals were slightly less than 7m in the month and at 35.5m visitors in the first eight months of the year was roughly level on the same period in 2024. Elsewhere, consumer confidence in Türkiye worsened in September to 83.9, down from 84.3 a month earlier.

Today’s Economic Data and Events

09:00 IN HSBC India PMI September

11:15 FR HCOB France composite PMI Sept

11:30 GE HCOB Germany composite PMI Sept

12:00 HCOB Eurozone composite PMI September

12:30 UK S&P Global UK composite PMI Sept

17:45 US S&P Global US composite PMI Sept

Fixed Income

US Treasuries softened at the start of the week with the 2yr yield up 3bps at 3.603% while the 10yr added 2bps to 4.1467%.

Aldar is tapping existing issuances of 2034 and 2035 maturities to raise USD 290m in green sukuk. The 2034 tap priced at a yield of 4.89% while the 2035 at 4.954%.

Binghatti is pricing a USD benchmark 3yr green sukuk

QNB mandated banks for a EUR benchmark 5yr green bond.

Isbank from Turkiye plans to sell Tier-2 USD bonds.

Bank Muscat has mandated banks for a USD 5yr bond

FX

The US dollar lost ground at the start of the week against most peers with a substantial gain in EURUSD, up nearly 0.5% at 1.1803. GBPUSD added 0.3% to 1.3514 while USDJPY dropped by 0.2% to 147.72.

Turkish lira was broadly flat at 41.366 while the Egyptian pound held steady at 48.2093. USDINR pushed higher to 88.3125, up 0.2%.

Equities

US equity markets pushed higher again at the open of trading with a 0.1% in the Dow Jones while the S&P 500 managed a 0.4% gain and the NASDAQ rose by 0.7%. European markets were mixed with a gain of 0.1% in the FTSE and slightly negative in the Eurostoxx.

Local markets were mildly positive with a less than 0.1% rise in the DFM while the ADX added almost 0.2%. The Tadawul was the standout with a 0.6% rise.

Commodities

Oil markets extended a recent string of losses on Monday with Brent lower by 0.2% at USD 66.57/b while WTI showed a more moderate loss. Iraq is reportedly close to agreeing a deal that would allow a resumption of oil exports through a pipeline that connects northern parts of the country to the Mediterranean via Türkiye.

Gold prices pushed to another new record high level of USD 3,746.70/troy oz along with gains across the rest of the precious metals complex. Industrial metals were mixed with aluminium and copper lower while iron ore managed to hold steady.