Sunset Market Commentary

Markets As was the case yesterday and on Monday, eco data still were second tier today. EMU September inflation was revised out of double digit territory (9.9% Y/Y from 10.0% preliminary reading), but with metrics of core inflation trending decisively higher, this doesn’t change the conclusion that the ECB still has plenty of work to […]

What the US Midterm Elections Mean for the Dollar and Stocks

On November 8, American citizens will head to the polls to elect their new Congress. Opinion polls and prediction markets argue the Republicans will take back at least one chamber, setting the stage for two years of political deadlock. Such an outcome could spark a relief rally in equity markets, and perhaps some profit-taking in […]

ECB Preview

Next week’s ECB meeting is set to bring another 75bp rate hike in all three policy rates. We expect Lagarde to say that the probability of the ECB staff’s downside risk scenario from the September projection exercise is becoming more likely, but fall short of giving new significant policy signals. We expect the ECB to […]

Canadian Dollar Yawns After Inflation Report

USD/CAD pushed higher earlier in the day but has pared most of those gains. In the North American session, the Canadian dollar is trading at 1.3757, up o.17%. Canada’s CPI ticks lower Headline inflation ticked lower to 6.9% in September, down from 7.0% in August. Still, the reading was higher than the consensus of 6.8%. […]

EU Energy Discussions in Focus

Market movers today Today the two-day EU Council meeting kicks off. Measures to limit energy price increases will be the main focus of the talks, but discussions about another round of EU-backed borrowing could also take place behind the scenes. We get September producer prices from Germany. It is an interesting release given the extreme […]

Mixed Earnings, Hawkish Fed, Growing Pressure on Truss and USD/JPY

Equities give back early-week gains on hawkish Fed talk, and mixed earnings. Netflix soared 13% yesterday, but Tesla lost more than 6% after the bell, after announcing a slight revenue miss in Q3. The UK’s political turmoil gets worse by the day, and the dollar-yen tests the 150 level amid mounting expectation of a Bank […]

Bank of Japan This Morning Announced an Unscheduled Bond Buying Operation

Markets We’ve grown more used to large bond yield moves over the past few months. But it still feels extraordinary when they appear out of thin air. That’s what happened yesterday during a trading session that hadn’t much to offer in terms of important economic data or other events. Yet core bond yields hit new […]

USD/JPY Breaches 150

USD/JPY continues to gain ground USD/JPY is almost unchanged today but hit a milestone in the Asian session as it briefly darted above the 150 line, which has psychological significance. This marked the yen’s lowest level since August 1990 as the currency continues to slide. The yen hasn’t recorded a winning session since October 4th […]

Aussie Briefly Drops after Jobs Report

AUD/USD dropped close to 100 points in the Asian session but has recovered and is trading in positive territory. Australia’s labour market remains solid Australia released September’s employment report earlier Thursday, which indicated that the labour market remains robust. The economy added 13,300 full-time jobs, with a decline of 12,400 part-time jobs. This follows a […]

Canadian Retail Sales and Future of Commodity Currencies

As fears of a recession start to settle in, commodity currencies have been on the backfoot despite offering comparably better real rates. Canada has been a particular example of this phenomenon, with its dollar weakening despite a more aggressive rate hiking path than the Fed. The most recent survey of businesses showed further deterioration in […]