· With no palatable military options, U.S. President Donald Trump may ultimately have no choice but to give diplomacy a chance to end the crisis over North Korea’s nuclear and missile programs.
For now, though, he is pursuing tougher economic sanctions, including an oil embargo, and opposed to making any concessions that might look like appeasement, insisting that more pressure on the regime of North Korean leader Kim Jong Un is needed before it is time to talk.
· President Donald Trump is considering many candidates to head up the Federal Reserve and has soured on nominating his top economic adviser Gary Cohn to lead the U.S. central bank, according to sources close to the White House and an administration official.
· European Central Bank President Mario Draghi is set to start laying the groundwork for stimulus reduction when policymakers meet on Thursday, giving investors some hints but probably holding off on any major commitment.
· The U.S. economy expanded at a modest to moderate pace in July through mid-August but signs of an acceleration in inflation remained slight, the latest survey conducted by the Federal Reserve showed on Wednesday.
Policymakers have raised interest rates twice this year but the prospect of a third in 2017 appears increasingly uncertain against a backdrop of weak price pressures despite the U.S. economy humming along with low unemployment and continued growth.
The Fed’s preferred measure of inflation retreated to 1.4 percent in July on a year-on-year basis, the slowest pace in more than 1-1/2 years.
Many of the Fed’s 12 districts reported that businesses were having difficulty filling job openings at all skill levels, but this was not resulting in a widespread boost to salaries.
· European Central Bank policymakers hold a widely anticipated meeting later on Thursday, amid speculation the central bank wants to wind down its extraordinary bond-buying monetary stimulus soon.
However, this year’s surge in the euro exchange rate complicates the ECB’s exit strategy. It curtails already sub-target inflation by making dollar-priced imports cheaper, dragging down the booming export sector and cutting into corporate earnings from outside the bloc.
Any mention of the euro and its relative impact on financial and economic conditions, as a result, may be the biggest market mover on Thursday.
· Oil prices dipped on Thursday over fears that Hurricane Irma in the Caribbean could interrupt crude shipments in and out of the United States, and as Libyan output began to recover from disruptions.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 18 cents, or 0.4 percent, at $48.98 barrel at 0687 GMT, but were still close to their highest in more than three weeks, reached in the previous session.
Brent crude futures LCOc1, the benchmark for oil prices outside the United States, dipped 21 cents, or 0.4 percent, to $53.99 a barrel, remaining near May highs marked the day before.
Reference: Reuters, CNBC
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