10-y Testing January Top of 3.90%

Markets Yesterday, especially US bond markets further adapted to guidance that persistent high inflation will require the Fed to raise its target rate well above 5.0% to stay there for a long period of time. US data were mixed. Jobless claims (194k) brought more evidence of a tight labour market. In line with the CPI […]

EUR/USD at 3-Week Low after Strong US Data

The euro is down for a third straight day and fell earlier to 1.0629, its lowest level since Jan. 23. In the European session, EUR/USD is trading at 1.0639, down 0.30%. US dollar flexing muscles The US dollar is showing some strength this week against the majors, as US data continues to shine. Retail sales […]

USD/JPY Breaks Above 135

The Japanese yen is down sharply on Friday. In the European session, USD/JPY is trading at 134.93, up 0.73%. The yen fell below 135 earlier today for the first time since December 23. Solid US data sends dollar higher The US dollar is broadly higher and has pummelled the yen, climbing 2.6% this week. Strong […]

Finally Hitting Home

Equity markets are ending the week in the red after finally falling victim to the persistent disappointment of US economic data on Thursday. It’s taken a lot but it would appear investors’ eternal optimism is being shaken, with the latest PPI figures finally driving the message home that bringing the economy in for a soft […]

Will the Fed Hike by 50-bp Next Month?

General risk appetite took a turn for the worse yesterday after a couple of key comments from Fed members. Normally the market wouldn’t hinge on just some comments, but they came at the tail end of some worrying data. That helped give the dollar a boost. The latest boost in the dollar came on top […]

Weekly Focus

A slew of US macro data this week confirmed that the US economy stands strong, and as a response, market are pricing in high rates for longer. US curve inversion steepened, and in line with our call for a stronger USD, EUR/USD slid to below 1.07 level. The US January CPI details continued to illustrate […]

Can Eurozone PMIs Recover Further in February?

The Eurozone economy has been showing some signs of improvement over the last three months but is not out of the woods yet. Will the flash PMIs for February point to a further rebound when released on Tuesday at 09:00 GMT? The euro has been consolidating this month as markets re-evaluate how many additional rate […]

Week Ahead – Fed Minutes and RBNZ Decision Coming Up

Investors will receive another dose of crucial data releases next week that can fuel FX volatility. The highlight will be the minutes of the last FOMC meeting, where there’s a risk that policymakers strike a different tone than Powell did back then. Over in New Zealand, the central bank is about to roll out another […]

Week Ahead – Economic Data Dominates

US The latest round of economic data (retail sales, CPI, PPI, jobless claims) are all signaling more Fed rate hikes are coming.  Wall Street will pay close attention to the flash PMIs, which could show manufacturing and service sector activity is stabilizing, existing home sales, jobless claims, and personal income & spending data.  The second […]

Weekly Economic & Financial Commentary: Rates Market Reset

Summary United States: Do Not Go Quietly Into That Good Night Resilience was on full display in this week’s economic indicators and market-based rate expectations moved closer in line to the forecast we have maintained for months: that the Federal Reserve will guide its main borrowing rate higher still to 5.25% and hold it there […]