FX News Today
European Fixed Income Outlook: 10-year Bund yields are up 6.0 bp in opening trade, French yields surged 7.1 bp so far. Peripherals are outperforming and the Italian 10-year lost a further -0.6 bp in opening trade, but at 3.3% already remains at very high levels, while elsewhere the combination of reduced Italy concerns, very strong data and an Oil price above USD 76 per barrel has seen a sharp jump in bond rates. 10-year Treasury yields are now up 4.7 bp at 3.23%, 10-year JGB yields are up 2.2 bp. Stock markets sentiment meanwhile has been hit by the pick up in interest rates and US futures are heading south in tandem with European futures after a largely weaker session in Asia. Global central banks remain on course to take out more stimulus, but while growth in the US looks strong, elsewhere signs of weakness are becoming more apparent as trade tensions hit economies. The local calendar today is quiet, which will leave the focus on Italy’s budget plans, which may vow to cut deficit levels from 2020 onwards, but are unlikely to to be the end of Italy jitters amid lingering tensions with Brussels and signs that the growth projections in the plan are too optimistic. There are no data releases, but Spain, France and the UK sell bonds and there is ECB speak from Nouy and Nowotny.
Charts of the Day
Main Macro Events Today
- FOMC Member Quarles Speech
- Canadian Ivey PMI – Expectations – The September Ivey PMI are expected to rise to 62.3 from 61.9 in August.
- US factory Orders – Expectations – The Factory orders are set to rise 2.3% in August, more than reversing a 0.8% July drop, while sales should be up 0.5% but inventories down 0.1%.
Support and Resistance Levels
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Andria Pichidi
Market Analyst
HotForex
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