Market News

In case you missed it: US Treasury is increasing the size of liquidity support buyback operations for longer-dated securities

That was the big announcement that has gotten markets buzzing again this week. Essentially, the US Treasury is doubling the size of buybacks at the long-end of the curve. So, that adds more liquidity i.e. supply into the market after having seen 30-year yields surge to its highest since 2007 earlier in the week. As a result, the dollar got slammed down alongside bond yields while stocks and precious metals surged higher.

The question now is, how significant is this change and will it be one to shift the structural outlook of not just the bond market but broader markets as well?

Let's first address the impact of the…

The big announcement from yesterday, in case you missed it: US Treasury is increasing the size of liquidity support buyback operations for longer-dated securities

That pretty much overshadowed the FOMC minutes and is arguably going to stick as the biggest headline in markets this week. Essentially, Bessent is announcing that they will at least double buybacks on the long-end on the curve to at least $4 billion per operation.

It's a significant change and one that shifts the debt burden to the short-end of the curve. But in a market size of over $30 trillion and US debt of over $40 trillion, the amount we're talking about is quite negligible. And all else being equal, it's arguably just another band-aid in not wanting to address the…

Nasdaq futures are testing the upper boundary of the descending channel that has contained price since June. With NQ near 29,616, the key question is whether the 29,500-29,600 area becomes support or whether price falls back inside the channel.

Key takeaways for Nasdaq traders

• Constructive scenario: NQ holds above the channel and resumes higher.

• Main risk: A daily close back inside the channel would warn of a failed breakout.

• Upside test: The recent 30,000-30,200 resistance area.

• Downside risk: A failed breakout could expose 29,000, followed by 28,700-28,800.

Why this Nasdaq retest matters (NQ daily chart)

NQ broke above the descending trendline after recovering sharply from the late-July low near 27,250. Price has now returned to the same…

Key lessons for gold and Bitcoin investors

• A Treasury buyback is not free money: The government repurchases older bonds, usually while continuing to issue new debt.

• Buybacks can calm markets: They add demand and liquidity to parts of the Treasury market, which can pull bond yields lower.

• This was not the same as Federal Reserve quantitative easing: The Treasury is managing government debt, not creating central-bank money.

• The market reaction carried a message: Gold’s outsized gain suggests traders may be increasingly concerned about the dollar’s long-term purchasing power.

• Gold and Bitcoin share a scarcity story, but they are not interchangeable: Gold is a traditional reserve asset, while Bitcoin remains much more volatile and often behaves…

Crypto market update: Bitcoin nears $70K as Ethereum and altcoins broaden the rebound

Crypto has shifted from fragile stabilization to a broad market rebound. Bitcoin has pushed toward $69,000-$70,000, Ethereum is outperforming, ETF demand has improved, and major altcoins are participating. The move is increasingly credible, but holding above the former $66,900 range ceiling is now more important than briefly trading through it.

Key takeaways for crypto investors and traders

• Bitcoin breakout attempt: BTC advanced from above $65,000 to approximately $69,258 in the supplied market snapshot.

• Institutional demand improved: US spot Bitcoin ETFs recorded $297.5 million of inflows on August 17 and another $189.3 million on August 18.

• Ethereum…

• SK Hynix swap costs, which spiked to 1000bp in June, now said to halve
• Run on banks feared as concern rises over government seizing deposits to fund war
• Australia's jobless rate climbs to a near four year high in July
• PBOC sets USD/ CNY mid-point today at 6.7808 (vs. estimate at 6.7196)
• Australian July 2026 jobs report: Unemployment rate 4.5% (expected 4.4%, prior 4.4%)
• China's 5 year and 1 year Loan Prime Rate (LPR) remain at 3.5% and 3% respectively
• Gold's oversized reaction to Treasury buyback reflects debasement trade
• AI boom powers Japan's exports as semiconductor shipments surge 49%
• Japan July 2026 exports and imports both higher than expected
• UBS stays constructive on equities as VIX hits 2026 low despite risks
• Trump vows crushing new…

If accurate, an easing of swap financing costs would mark a meaningful shift in risk appetite toward SK Hynix specifically, and Korean chip names more broadly, after banks moved aggressively in June to curb concentrated leveraged exposure. Lower financing costs make it cheaper for hedge funds and other leveraged investors to re-establish or expand bullish positions via swaps, which could translate into renewed buying pressure on the stock and, by extension, the Kospi given SK Hynix's outsized index weighting. However, given this detail rests on unnamed sources rather than confirmed reporting, it should be treated as directional rather than definitive until corroborated by a named bank or a tier-one outlet. The scale of the reported move,…

This is a domestic financial stability story for Russia rather than one with a direct read-through for Western asset prices, but it carries meaningful signal value for anyone tracking the sustainability of Moscow's war financing. A sustained deposit exodus of this scale tightens the funding base available to Russian banks just as they are already carrying a heavy load of state-directed lending to defence industries, raising the risk of a domestic liquidity squeeze that could eventually force more aggressive intervention, whether through deposit restrictions, capital controls, or the kind of confiscatory measures Russians are already anticipating. For traders positioning around sanctions and secondary market risk, the dismissal of a senior…

The unemployment rate's move to 4.5% is a genuine miss against 4.4% forecasts and takes the jobless rate to its highest level since late 2021, a signal likely to firm up expectations that the RBA has room to pause its hiking bias rather than push through further increases in the near term. That said, the softness is not uniform: full-time employment actually rose in July, the entire decline was driven by part-time roles, and the three-month average pace of employment growth still sits at a reasonably firm 34k, with the three-month average jobless rate unchanged at 4.4%. That combination points to a labour market that is softening gradually rather than deteriorating sharply, which should give the RBA room to assess the cumulative effect…

Australian June 2026 jobs report, just the numbers here on this post.

I'll have more to come on this separately, details an implication etc. 

The PBOC allows the yuan to fluctuate within a +/- 2% range, around this reference rate. More here on this.

• 7-day reverse repurchase operation volume zero again
• zero also in overnights
• 327.4 billion yuan of overnight reverse repos matured today
• net withdrawal was 327.4 billion yuan

Earlier:

• China's 5 year and 1 year Loan Prime Rate (LPR) remain at 3.5% and 3% respectively

The People's Bank of China left its loan prime rates unchanged on Thursday, holding the one-year rate at its current level and the five-year rate, the benchmark for mortgages, steady as well. The decision confounded a Reuters analysis earlier this week that had flagged a surprise cut as a live possibility, even as broad-based stimulus has historically run against Beijing's instincts:

• Analysts say that a surprise China LPR cut cannot be ruled out this week

The case for easing had appeared to build through a run of weak data, including a July industrial output decline, softer than expected retail sales, extending house price falls, and cooling PMI readings, alongside a record contraction in bank lending. Premier Li Qiang had called for…