Headlines:
Markets:
- Australian Dollar Advances, Swiss Franc Lags During the Day
- European stocks rise; S&P 500 futures up 0.1%
- US 10-year Treasury yields rise 1.7 basis points to 3.670%
- Gold rises 0.2% to $2,516.57
- West Texas Intermediate crude rose 1.7% to $68.45.
- Bitcoin price rises 1.0% to $58,057
The session was quiet as markets lacked any real follow-through after yesterday’s US CPI report.
The inflation numbers largely confirm a 25 basis point rate cut by the Fed next week, which keeps things under control so far this week.
The US dollar remained steady on the day, little changed against the other major currencies. The USD/JPY pair briefly rose to the 143.00 level, but has now fallen back to almost stable levels around 142.40-50.
Additionally, the euro remains trapped by large EUR/USD options expirations, leaving little breathing room until we get to the ECB meeting later.
Even so, the ECB’s 25bp rate cut is already in the air, so there shouldn’t be any big moves in euro-denominated asset prices unless Lagarde makes a wrong move.
In the stock market, the mood is also calm with US futures slightly higher. European indices are trying to catch up with Wall Street’s overnight gains. As for the bond market, things are calmer today with demand for bonds slightly reduced. The two-year Treasury yield is now at 3.66%, after testing its 2023 low of 3.55% yesterday.
All eyes are now on the ECB and more US data due out today. The latest data will include weekly initial jobless claims and PPI data. So, this should keep markets interested in North American trading later.