 Canadian Dollar jumps broadly in early US session, after stronger than expected inflation data remove another reason for BoC rate cut. Though, for now, Loonie is overshadowed by Sterling and Swiss Franc, which are the strongest ones. Meanwhile, risk appetite recedes mildly ahead of FOMC rate decision. Dollar is also mixed. Australian and New Zealand Dollars are the weakest ones. Yen is third weakest as German and US treasury yields recover. There is practically no chance for Fed to cut interest rate from 2.25-2.50% today. It's too early for the "insurance" rate cut given that Trump and Xi still have a chance to avoid trade war escalation in next week's G20 meeting. Though there are still two major focuses. First one is on whether Fed will drop the "patient" stance from the statement, which will be an indication on readiness to act. Secondly, we believed that Fed's new economic projections adopt a base case of no escalation in trade conflicts. Such projections might not be dovish enough to push for a rate cut. Or, if the forecasts are dovish, they're really rather dovish. In Europe, currently, FTSE is down -0.30%. DAX is down -0.05%. CAC is up 0.19%. German 10-year yield is up 0.025 at -0.293. Earlier in Asia, Nikkei rose 1.72%. Hong Kong HSI rose 2.56%. China Shanghai SSE rose 0.96%. Singapore Strait Times rose 1.53%. Japan 10-year JGB yield dropped -0.0042 to -0.134. |
No comments:
Post a Comment