Developed equities lost 5-6%, emerging markets lost 9-10%, and Chinese equities lost over 12%. The S&P 500 finished the month -6.0% and experienced its first 10% correction in four years. Bonds provided a relative safe haven, with intermediate investment grade losing -0.1% as yields on U.S. Treasuries were largely unchanged given the uncertainty of a Fed rate hike in this environment.
- U.S. GDP in Q2 was revised higher to 3.7%, above the consensus estimate of 3.2%, as consumer spending increased at an annual rate of 3.1% and corporate investment and inventory growth were higher than expected (BEA)
- The Chinese central bank (PBOC) adjusted the yuan’s exchange rate relative to the U.S. dollar, devaluing the currency and signalling that Chinese economic growth is declining; the Shanghai Composite finished August down -12%
- Global oil demand increased at its fastest pace in five years and is expected to continue into 2016, as global growth continues to expand and consumers respond to sub-$50 oil (IEA)
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