Tag Archive: US

Sharp Fall in US Yields ahead of Large Supply

2023-10-10

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2023-10-10

Overview: The market continues to monitor developments in Israel and the Middle East. The economic calendar is light today and the market is showing a strong appetite for risk. Except for China and South Korea, large bourses in the Asia Pacific rallied. Japan's indices jumped more than 2% and Australia by 1% to lead the region. Europe's Stoxx 600 is up 1.5% near midday, which, if sustained would be the largest in nearly a month. US index futures...

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War in Israel Spurs Flight to Dollars, Yen and Gold, While Driving up the Price of Oil

2023-10-09

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2023-10-09

Overview: There are three main developments. First, the market is digesting the implication of the US employment data, where the optics were strong (336k increase in nonfarm payrolls compared with 170k median forecast in Bloomberg and Dow Jones surveys) but some details were disappointing (like the third consecutive decline in full-time posts, seasonally adjusted). Second, Chinese mainland market re-opened after a six-day holiday). Chinese stocks...

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US Employment Data to Determine Whether the Greenback’s Rally since mid-July is Over…Maybe

2023-10-06

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2023-10-06

Overview: One key issue for market participants is if the dollar's pullback is the beginning of something important or is largely position adjusting ahead of today's US jobs report. We suspect that the dollar's rally that began in mid-July is over, though a strong employment report that boosts the chances of a Fed hike before year-end could quickly demonstrate the folly of making claims ahead of what is still one of the most important reports in...

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Markets Continue to Struggle

2023-10-05

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2023-10-05

Overview:  The markets remain unsettled. Follow-through dollar selling has been limited today after yesterday's pullback. Narrow ranges are prevailing, but the Norwegian krone and Canadian dollar, the weakest G10 currencies in recent days, are heavier again today. Although it seems that the BOJ did not intervene earlier this week, but the dollar bulls has been chastened just the same and the greenback is holdings below yesterday's high...

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Strategic Ambiguity Leaves Intervention Question Unanswered, but US Dollar has Steadied

2023-10-04

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2023-10-04

Overview: Dramatic yen price action around the JOLTS report yesterday after the dollar pierced the JPY150 level spurred speculation of BOJ intervention. Although there has been no confirmation, the strategic ambiguity is helping steady the yen and the dollar more broadly today, even though US yields remain firm. Final PMI readings were a better than the flash estimates and this may also be facilitating the consolidative tone. Most promising, from a...

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Dollar Stabilizes After Extending Gains

2023-10-03

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2023-10-03

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...

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US Yields and Dollar Rise After US Government Closure Averted

2023-10-02

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2023-10-02

Overview: The US avoided a government shutdown, barely, and this eased one of the headwinds that were anticipated. In turn, this is spurring new gains in US interest rates and helping underpin the dollar at the start of the new quarter. The 10-year Treasury is holding above 4.60% and nearing last week's high (4.68%). The two-year yield gapped higher and is near 5.10%. The high from September 21 was almost 5.20%. The Swiss franc is the only G10...

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Dollar Sets Back into Month- and Quarter-End Ahead of likely US Government Shutdown

2023-09-29

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2023-09-29

Overview: The dollar's surge stalled yesterday, and follow-through selling has pressed it lower against all the G10 currencies today. The dollar-bloc and Scandis are leading the move. Month-end, quarter-end pressures, coupled with a likely partial shutdown of the government beginning Monday, and after key chart levels were approached or violated earlier this week, serving as a bit a cathartic event. The Swiss franc snapped a 12-day losing streak...

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Looming US Government Shutdown Stems the Dollar’s Surge

2023-09-28

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2023-09-28

Overview: The increasingly likely partial US federal government shutdown has spurred a bout of liquidation of long dollar positions. The psychologically important JPY150 level was approached, and the euro was sold through $1.05 yesterday, and the greenback has come back better offered today. It is lower against all the G10 currencies. It is mixed against the emerging market currency complex, with central European currencies and South African rand...

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Firmer Bonds and Stocks, but the Dollar Presses Ahead

2023-09-27

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2023-09-27

Overview: The S&P 500 hit three-month lows yesterday, while the Conference Board's measure of consumer confidence fell to a four-month low. New home sales fell to their lowest level in five years. The US federal government appears headed for a partial shutdown on October 1. Still, the greenback rides high. It is extending its gains against several G10 currencies, including the euro and sterling. The Swiss franc is moving lower for the 12th...

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Neither the Threat of Intervention Nor a Possible US Government Shutdown is Derailing the Greenback

2023-09-26

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2023-09-26

Overview: The US dollar is stabilizing a bit but only after extending its gains initially It reached almost JPY149.20, while the euro slipped to $1.0570 before recovering to straddle $1.06 in the European morning. Sterling sank a little through $1.2170 but stabilized to return to almost $1.2200. The Australian dollar tested last week's low slightly below $0.6390 before resurfacing above $0.6400. The US dollar toyed with CAD1.3500, where there is a...

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Dollar Edges to New High for the Year against the Japanese Yen, While Developer Woes Hit Chinese Stocks and Yuan

2023-09-25

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2023-09-25

Overview: The US dollar begins the new week on a firm note. It is trading at new highs for the year against the Japanese yen and is bid against nearly all the G10 currencies, though the Swedish krona and Canadian dollar are resisting the greenback's push. Most emerging market currencies are heavier, with the Polish zloty and a few East Asian currencies holding their own. Gold is trading with a heavier bias near $1922, but within the ranges seen at...

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Yen Drops After BOJ Does Nothing and Says Little

2023-09-22

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2023-09-22

Overview:  The BOJ's failure to do anything or further ideas that an exit of the negative target rate, despite the firm CPI report helped the dollar recover the ground lost yesterday against the yen. The focus has returned to "intervention watch" and the market continues to press for the official pain threshold. Sterling is the weakest of the G10 currencies, off another 0.5% today following the BOE's decision not to hike yesterday. The...

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The Canadian Dollar Shines in a Mostly Consolidative FX Market Ahead of the Flurry of Central Bank Meetings

2023-09-19

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2023-09-19

Overview: Ahead of the flurry of central bank meetings, starting with the Federal Reserve and Brazil tomorrow, the dollar is largely consolidating in narrow ranges. The euro, sterling, and yen are trading slightly heavier, while the dollar bloc and Scandis enjoy a firmer bias. The Canadian dollar stands out as is trades at its best level since mid-August ahead of its CPI report and despite a diplomatic dispute with India and the failure of...

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Calm Before the Storm: Greenback Confined to Narrow Ranges

2023-09-18

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2023-09-18

Overview:  With many central bank meetings in the days ahead, the dollar has begun the new week on a quietly and mostly in tight ranges, helped by a holiday in Tokyo. G10 currencies, outside of the Scandis are slightly firmer in European turnover. Emerging market currencies are narrowly mixed, but of note the 0.25% decline makes the Chinese yuan the weakest. The Mexican peso is extending its recovery into the seventh consecutive session. While...

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Heightened Speculation of an ECB Hike Tomorrow Fails to Lend the Euro Support

2023-09-13

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2023-09-13

Overview: The US dollar is trading with a firmer bias against all the G10 currencies ahead today's August US CPI report. Even increased speculation that the ECB will hike rates tomorrow has failed to lift the euro, while a larger than expected contraction in the UK's July GDP pushed sterling briefly through last week's lows. The dollar rose to a marginal new high for the week against the Japanese yen, as the market seemed uninspired by the cabinet...

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Greenback Bought on Pullback

2023-09-12

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2023-09-12

Overview: The dollar was bought after yesterday's pullback spurred by Japanese and Chinese comments and the tighter capital controls from Beijing requiring permission to buy more than $50 mln. The economic and monetary policy divergence continues to underpin the greenback. It is firmer against all the G10 currencies and is mostly inside yesterday's ranges. Most emerging market currencies are lower, led by central European currencies. The Chinese...

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Yuan Sulks in to the Weekend, While Finishing Touches are Put on the Dollar Index’s Eighth Consecutive Weekly Gain

2023-09-08

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2023-09-08

Overview: The greenback is lower against most currencies today as it consolidates ahead of the weekend. The Dollar Index's eight-week advance is the longest since a 12-week rally 2014. The Chinese yuan is an exception. Its losses were extended today. Against the offshore yuan, the dollar traded above the onshore band, which is most often respected. Equities ae extending this week's slump. All the large bourses in the Asia Pacific region but India...

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The Dollar and Oil Steady After Yesterday’s Advance

2023-09-06

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2023-09-06

Overview: Bonds and stocks are mostly heavier today and the dollar has turned mixed. Oil prices are consolidating after soaring to new highs since late last year on the longer than expected extension of Saudi Arabia's extra cut of one million barrels a day. Since July, it has been extending it by one month at a time. Yesterday, it extended it through Q4. Russia, who had previously indicated intentions on reducing its exports by 500k barrels,...

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US Dollar Punches Higher

2023-09-05

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2023-09-05

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...

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