Finance World

The Bloomberg Commodity Index, which tracks the performance of 22 major commodity futures, rose from the ashes this past week. The 2% gain occurred after some early weakness after the US announcement of additional tariffs on $200 billion worth of Chinese imports.

Currencies

Upbeat NFP report supports USD

American wages climbed in August by the most since the recession ended in 2009 and hiring rose by more than forecast, keeping the Federal Reserve on track to lift interest rates this month and making another hike in December more likely. Average hourly earnings for private workers increased 2.9 percent from a year earlier exceeding all estimates and the median projection for 2.7 percent.

A consortium composed of Novus Aviation Capital, Development Bank of Japan Inc., NORD/LB Norddeutsche Landesbank and The Boeing Company has launched Cedar Aviation Finance (CAF), a new junior debt fund designed to provide airlines and lessors with higher loan-to-value financing for the acquisition of Boeing manufactured aircraft. The fund will be managed by Novus and will provide junior and mezzanine loans to bridge the gap between equity and senior debt.

Commodities remain under pressure from uncertainty surrounding the US’ trade dispute with the rest of the world and the continued weakness seen across emerging market stocks, bonds, and currency markets. These developments have resulted in the Bloomberg Commodity Index losing close to 9% since its early June peak while sending it towards its lowest weekly close in more than a year.

The commodity sector recorded a third consecutive monthly loss in August as trade wars and emerging market turmoil more than offset a return to profit across the energy sector. Crude oil moved higher on emerging signs that Iranian production has begun to fall in response to US sanctions. Many of the developments, both up and down, can directly be linked back to decisions taken by the US administration and Federal Reserve in recent months.