US Deficit Jitters Roil Markets as Yields Surge, Dollar Sinks, Bitcoin Hits Record
The dominant driver in global markets at the moment is rising concern over the US fiscal deficit. 30-year yield surged toward 5.1% overnight, its highest level since October 2023. 10-year yield also breached the 4.6% mark for the first time in months. Equity markets responded accordingly, with major US...
US Assets Remain Under Pressure; Sterling Gains Muted Despite Hot CPI
Dollar’s selloff moderated slightly during European session, but pressure on US assets remains firmly in place. DOW futures are down more than -300 points, while the 10-year Treasury yield has surged back above the 4.5% mark. Market sentiment continues to reflect unease over the US fiscal outlook and uncertainty...
Dollar Selloff Accelerates on Fiscal, Trade, and FX Policy Risks
Dollar came under broad selling pressure in Asian session, with fresh technical signals suggesting that the near-term recovery has already run its course. Also, the selloff appears to be gathering pace on a range of fundamental concerns.
One focus is on Capitol Hill, where the House of Representatives is expected...
Loonie Lifts on Hot Core Inflation, But BoC Cut Still in Play
Canadian Dollar firmed modestly in early US trading after inflation data showed a sharper-than-expected pickup in core price pressures. While headline CPI slowed to 1.7% in April, the drop was largely due to a steep decline in energy prices. In contrast, underlying inflation picked up pace, with core measures...
Aussie Dips on RBA’s Dovish Tilt, But Risk Sentiment Provides Cushion
Aussie softened modestly following the RBA’s widely expected 25bps rate cut to 3.85%. But selling was contained as broader market sentiment remained supportive.
While the move itself was no surprise, the updated economic forecasts leaned dovish, notably with headline CPI now seen at just 3.0% by year-end, down from the...
Euro and Pound Rally on UK-EU Pact, Dollar Wobbles
Euro and Sterling surged today after the UK and EU unveiled a sweeping new agreement resetting their defence and trade relationship, the most substantial since Brexit in 2020. The comprehensive deal spans key sectors including security, energy, travel, trade, and fisheries. UK Prime Minister Keir Starmer hosted European Commission...
Risk Mood Softens as Moody’s US Downgrade and Mixed China Data Dent Confidence
Global markets kicked off the week with a mild risk-off tone, driven by renewed concerns over US creditworthiness and mixed economic data out of China. Moody’s downgrade of the U.S. sovereign rating from Aaa to Aa1 late last Friday has cast a shadow over investor sentiment. Meanwhile, China’s latest...
Moody’s Downgrade Disrupts Calm from Tariff Truce, Dollar Faces New Test
Just as markets were finding their footing following a series of positive trade developments, Moody’s delivered a late-week shock by downgrading the US sovereign credit rating from Aaa to Aa1. The move overshadowed the optimism sparked by the US-China tariff truce and the broader de-escalation of trade tensions.
The trade...
Markets Stuck in Ranges as Data Fail to Inspire
Market activity remains subdued ahead of the weekend, with major currency pairs and crosses locked within yesterday’s tight ranges. Earlier in the day, New Zealand Dollar received a brief lift from rise in inflation expectations, but the move lacked conviction and quickly faded. Similarly, Japan’s weaker-than-expected Q1 GDP figures...
Weak Data Overlooked as Yen Rises on Risk-Off Mood
Mild risk-off mood is helping Yen to extend its near-term rebound, despite fresh signs of economic weakness at home. Japan’s economy was already showing signs of strain even before the impact of US tariffs, with Q1 GDP contracting more sharply than expected. BoJ is left in an increasingly precarious...
Markets Tread Water as Traders Shrug Off US PPI and UK GDP Surprises
Global financial markets are trading in tight ranges today, with little conviction seen across major asset classes. U.S. futures are pointing to a mildly weaker open. Despite a surprise decline in US producer prices in April, suggesting a possible easing of inflation pressures, there was little follow-through in market...
Cautious Trade as APEC Cuts Growth View, Key UK and US Releases Awaited
Activity in the global stock markets remained relatively subdued, with US posting a mixed close overnight and Asian markets slipping modestly lower today. Despite China’s 50bps Reserve Requirement Ratio cut taking effect, expected to inject over USD 138B into the banking system, investor reaction has been muted. The cautious...
Dollar Steadies After Early Weakness, Focus Turns to Australia Jobs Data
Dollar faced broad selling pressure throughout the Asian and European sessions but has since found some footing as markets transition into the US trading day. However, direction remains murky, with traders appearing undecided on whether to push the greenback higher or extend the recent pullback. A similar tone of...
Dollar Rally Stalls, Market Cools, Trade Optimism Tempered by Reality
Global markets showed signs of fatigue overnight as trade optimism gave way to a more cautious tone. In the US, the S&P 500 eked out another gain, turning positive for the year, while DOW lagged and closed modestly lower. The divergence reflects a market still digesting the implications of...
Dollar Eases as Trade Boost Fades, Sterling Finds Support on Wages and BoE Rhetoric
Dollar softened slightly in early US trading today, though the move appears more related to a fading post-trade-deal rally than any direct reaction to economic data. While April’s inflation report showed encouraging progress on headline disinflation, the core CPI reading held firm, suggesting underlying price pressures remain sticky. That...
Fed Cut Bets Recede Ahead of US CPI, Dollar Approaches Key Resistance
Global equity markets surged overnight in response to the breakthrough US-China tariff truce, with risk appetite roaring back across the board. DOW jumped more than 1100 points, while S&P 500 and NASDAQ surged 3.26% and 4.35%, respectively. The relief rally extended into Europe, where Germany’s DAX surged to a...
Risk Assets Soar as US-China Tariff Rollback Surpasses Expectations
Global risk markets surged after the surprising breakthrough in US-China trade negotiations delivered results far beyond market expectations. Just days ago, hopes were low, with even the mere continuation of talks seen as a positive development. Investors had braced for a possible breakdown or at best, a symbolic gesture...
Markets Cautious Despite US-China Trade Progress, US Inflation and Consumer Data In Focus This Week
Markets opened the week on a subdued note despite the White House’s announcement that a trade agreement had been reached with China following negotiations in Switzerland. Despite the positive headline, investor reaction has been muted with lackluster performance in Asian stocks. Traders appear to be holding back judgment, at...
Sterling and Dollar Lead as Trade Deal Grabs Attention
Last week was dominated by developments out of the US and UK, not just because of monetary policy decisions, but also the unexpected announcement of a US-UK trade deal. Fed's hold and BoE's cut were were largely overshadowed by the surprise trade breakthrough.
Importantly, the structure of the agreement offered...
Markets Turn Cautious Again Ahead of US-China Talks in Switzerland
The forex markets are quiet today, with major pairs largely consolidating after yesterday's modest directional movement. Dollar and British Pound remain the strongest performers overall, bolstered earlier in the week by the announcement of the US-UK trade agreement. However, both currencies are now struggling to extend their momentum. Canadian...