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German Economy Recession Bound | US Consumer Confidence Data Due

Published August 27, 2019

  • The second reading of German Q2 GDP showed that a collapse in exports is weighing enough on the country’s economy to push it to contraction territory. This supports the market expectation that GDP will shrink by around 0.25% in Q3, easing the German economy into a technical recession.
  • The Richmond Fed Manufacturing Index is due this morning. Expectations are for its first improvement in six months with a 10 point gain to -2 in August. The index hit a high of 14 back in February but has since declined to -12. The Conference Board’s Consumer Confidence Index is expected to have given back some of its July gains, dropping to a still-strong 129 level in August.
  • Market participants are markedly confused by President Trump’s latest trade threats. Yesterday’s rally was driven by optimism following comments made by the president at the G-7 meeting, but this positivity has somewhat faded today as it becomes increasingly unclear whether any call from China happened over the weekend at all.
  • OPEC has reached a conformity level of 159% in July 2019, according to the Joint Ministerial Monitoring Committee meetings taking place throughout the day. The JMMC noted the overall conformity of 159% in July 2019 was 22 percentage points higher than in June 2019. This high level has offset uncertainty in the market due to ongoing economic growth concerns.

To the Clients of EncoreFX:

 

It is with much regret that we inform you that EncoreFX’s (the “Company”) offices are suspending trading effective immediately.

This suspension will give the Company time to consider its restructuring alternatives. The restructuring has become necessary as a number of customers to whom the Company granted credit have defaulted on their obligations to the Company due mainly, we believe, to the rapid changes in the FX market caused by the coronavirus pandemic.

 

In order to provide stakeholders with transparency, the Company has filed an assignment in bankruptcy pursuant to Section 49(1) of the Bankruptcy and Insolvency Act (Canada) (the “BIA”) with respect to its Canadian operations and has assigned its Australian and New Zealand subsidiaries in Voluntary Administration in Australia and New Zealand. 

 

Ernst & Young has been appointed as the licensed insolvency trustee (the “Trustee”) in Canada and as the Administrator in Australia. 

 

Once the Trustee, working with the Company, has determined the best options for the Company and its stakeholders it will share that information with you. Information pertaining to the bankruptcy of EncoreFX will be available, in due course, on the Trustee’s website at: www.ey.com/ca/encorefx.