Tag Archives: Japan

Overview: The market expects a soft US CPI print today, which has recently been associated with risk-on moves. The US 10-year yield is holding slightly above 3.50%, the lowest end of the range since the middle of last month. The two-year yield is a little above 4.20%, also the lower end of its recent range. Most observers see the Federal Reserve slowing the pace of its hikes to a quarter point on February 1. The dollar has spent the last few days consolidating after...

Overview: After sharp losses yesterday, the US dollar has stabilized today arguably ahead of Fed Chair Powell’s speech at the Riksbank symposium. Yesterday’s Fed speakers stuck to the hawkish rhetoric, and this seemed to help reverse the equity market gains, though the greenback remained soft. If Powell does not push back against the easing of financial conditions, it could very well fan risk-taking appetites and lead to a further easing of financial conditions. Asia...

Overview: The US dollar extended yesterday's gains as the market adjusts positions ahead of the jobs data. Yesterday and today's price action looks to have strengthened the near-term technical outlook for the greenback. However, the intraday momentum indicators are stretched. This warns of the risk of a counter-intuitive move after the data, barring a significant surprise. Meanwhile, one of the Fed's leading hawkish voices, St. Louis Fed President Bullard seemed to...

Overview: The US dollar is consolidating in a mixed fashion today. The FOMC minutes drew much attention but failed, at least initially, to spur a significant shift in expectations. The pricing in the Fed funds futures strip is still consistent with a cut later this year, which the minutes were clear, no officials anticipate. Today's US ADP jobs estimate, and November trade balance are being overshadowed by tomorrow's nonfarm payroll figures. The Fed's Harker,...

Overview: Market participants have returned from the New Year celebrations apparently with robust risk appetites. Equities and bonds are rallying, and the dollar has surged higher. The markets seem to be looking past the surge in China’s Covid cases and anticipates a recovery, helping Chinese equities lead Asia Pacific bourses higher, where Japanese markets are still on holiday. Europe’s Stoxx 600 is 1.6% higher in late morning turnover. US equity futures are also...

Overview: Seven of the G10 central banks pumped the brakes between last week and this week as they purposely seek to push demand back into line with supply. And there are more signs that they are succeeding in weakening growth impulses. The dramatic surge in European bond yields continues today with 10-year rates mostly rising another 13-15 bp. Italian and Greek benchmark yields are up 22-24 bp. The US 10-year Treasury yield is up nearly five basis points to 3.50%....

Overview: The US dollar has come back bid after losing ground against most currencies as the markets reacted to the FOMC decision and press conference. The Antipodeans and Scandis have been tagged the hardest, illustrating the risk-off mood, and arguably the weakening growth prospects. Countries that peg their currencies to the dollar have hiked rates, as has the Philippines and Taiwan. The Swiss National Bank and Norway have also lifted policy rates by 50 bp and 25...

Overview: The softer than expected US CPI drove the dollar and interest rates lower, while igniting strong advances in equities, risk assets, commodities, and gold. Calmer market conditions are prevailing today, and we suspect that in the run-up to the FOMC meeting, a broadly consolidative tone will emerge. The dollar is mostly softer, but within yesterday’s ranges. Only the New Zealand and Canadian dollars among the G10 currencies are softer. Emerging market...

Overview: The dollar softer against the G10 currencies ahead of today’s CPI report and the FOMC meeting the concludes tomorrow. Emerging market currencies are most mixed. The Hungarian forint leads the complex with around a 1% gain on news of a preliminary deal struck with the EU. The South African rand is the worst performer, off around 0.8%, as impeachment proceedings against Ramaphosa proceed. Global equities are mostly higher today after the strong advance seen...

Overview: There is nervous calm in the capital markets today.  The weakness of US shares yesterday is taking a toll today. An exception in the Asia Pacific region is the Hang Seng and the index of mainland shares that trade there, which up around 3.5% today on thUe easing of some Covid protocols.  Europe’s Stoxx 600 is off for a fifth day, its longest losing streak in nearly two months. US futures are posting minor gains. Benchmark 10-year yields are mostly little...