Tag Archives: Brazil

Overview: The US CPI has become one of the most important high-frequency economic reports for the capital markets. The dollar is going into the report narrowly mixed against the G10 currencies. Comments by BOJ Governor Ueda about the weakness in consumption of non-durable goods was seen by some as reducing the likelihood of a change in policy next week. The greenback is threatening to snap a five-day drop against the yen. Most of the G10 currencies are in narrow...

Overview: News that the Japanese economy expanded rather than contracted in Q4 23 has fanned expectations that rates could be as early as next week. This is helping keep the yen supported, though it remains in the pre-weekend range, albeit barely. While the dollar is softer but consolidating against the euro, Swiss franc, and Canadian dollar, it slightly firmer against the Antipodeans and Scandis. Sterling is also in a narrow range, but with a softer bias. Most...

Overview: Most of the G10 currencies are trading quietly in narrow ranges today. After a slightly firmer than expected national CPI reading, which still moderated, and a pullback in US yields, the Japanese yen is the strongest of the major currencies. The dollar has pulled back from almost JPY151 to nearly JPY150. The New Zealand dollar is the weakest, off about 0.2% ahead of tomorrow's central bank meeting. After selling $127 bln of coupons yesterday, the US...

Overview: The dollar's gains were initially extended before a consolidative tone emerged. The euro has been sold to $1.0460 and has returned to almost $1.05. Sterling fell to nearly $1.2060 and has recovered though has stopped short of $1.2100. The dollar edged closed to JPY150 but stalled near JPY149.95 and has held above JPY149.65. The Australian dollar near $0.6300 and the greenback rose to CAD1.3725. Benchmark 10-year yields are firm, though a well-received...

Overview:  Disappointing data in Asia and Europe has sent the greenback broadly higher. The strong gains posted before the weekend were mostly consolidated yesterday when the US and Canadian markets were on holiday. The rally resumed today. The Antipodeans and Scandis have been hit the hardest (-0.7% to -1.25%) but all the G10 currencies are down. The Swiss franc and yen are off the least (-0.35%-0.45%), and the euro and sterling have taken out their recent lows....

Overview: The global capital markets remain unsettled. The combination of the BOJ adjustment of its monetary policy, Fitch's downgrade of the US to AA+, ahead of a flood of supply, and new measures by China have injected volatility into the summer markets. The US dollar has extended it gains today against the G10 currencies and most emerging market currencies. The yen has recovered a bit after the BOJ stepped in and bought JGBs for the second time this week at...

Overview: Late yesterday, on the eve of the quarterly refunding announcement, Fitch cut the US rating to AA+ from AAA, citing project fiscal deterioration over the next few years and "the erosion of governance". S&P also has the US as an AA+ credit. Ironically, many observers who have been critical of the US monetary and fiscal policies, like former Treasury Secretary Summers and El-Erian, were also critical of Fitch's decision. The US 30-year yield reached its...

Overview: The UK surprised with higher-than-expected consumer inflation and budget deficit, and the odds of a 50 bp hike tomorrow edged higher. Sterling has been sold on the news and is the weakest of the G10 currencies, off about 0.5%. The dollar is mixed with the euro, Swedish krona, Canadian dollar, and Swiss franc posting small gains. Emerging market currencies are lower, including the Chinese yuan, which is at new lows since last November. The Mexican peso,...

Overview: The 0.5% decline in US March producer prices pushed on the door opened by the softer-than-expected CPI on Wednesday. The Fed funds futures market sees the year end rate to a 4.33%, while still pricing in a nearly 70% chance of a hike on May 3 to 5.25%. The dollar tumbled to new lows for the year against the euro, sterling, and Swiss franc. The Dollar Index made a new low for the year today, a few hundredths of an index point below the low set in early...

Overview:  The market took US short-term rates and the dollar lower after the CPI data, which was largely in line with expectations. On the one hand, the odds of a quarter-point hike next month increased slightly (73.6% vs. 71.6%) to 5.25%, but it reinforced that sense that it is last hike and that the Fed will unwind this hike and more before the end of the year. The year-end implied policy rate fell by about six basis points to 4.33%. The dollar was sold against...