USD moved down from new to 20-year highs at 107.00 but remains in demand (USDIndex 106.64), US Stocks flat on close (NASDAQ +0.35%). FED Minutes leaned to the hawkish side. – ‘more restrictive’ policy as likely if inflation fails to come down. Asian markets are mostly positive (Hang Seng -0.13%, Nikkei +1.4%). Yields closed up +3.3%. Oil fell another -1.0%, Gold plummeted again to $1735 & BTC rotates at $20k. UK PM Johnson has now lost over 50 members of his government but refuses to resign. AUD outperforms overnight.
Yesterday US ISM Service PMIs were better than expected but still at 25-mth low & JOLTS showed 11.25m job vacancies (1.9 jobs for every unemployed person).
- USDIndex tested 107.00 and remains on Bid at 106.65 now.
- Equities – USA500 closed +0.36% 13.69pts (3845), US500FUTS at 3854 now.
- Yields 10-year yield higher, closed at 2.92%, trades at 2.90% now. Yield curve inverted again yesterday.
- Oil & Gold had weak sessions – USOil traded down to $95.10 lows and remains under $100.00 at $98.48. Gold fell to 1732, next support at 1725, trades at 1745 now.
- Bitcoin continues to trade around $20K, testing $20.3K today.
- FX Markets – EURUSD remains pressured at 1.0200, USDJPY rallied from under 135.00 to test 136.00 now. Cable trades at 1.1950 now.
Overnight – German Industrial Output missed at 0.2% from 1.3%. Australian Trade Balance much better at 15.97b vs 10.7b & 13.25b prior.
Today – US ADP Employment & International Trade, ECB Minutes, EIA Oil Inventories, Speeches from Fed’s Waller & Bullard, ECB’s Lane & Enria, BoE’s Pill.
Biggest FX Mover @ (06:30 GMT) AUDJPY (+0.42%). AUD lifted by trade data. Rallied form allied from 91.50 Wednesday to 92.70 today before cooling. MAs aligning higher, MACD histogram positive & rising, RSI 55.24 & rising, H1 ATR 0.227, Daily ATR 1.398.
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Stuart Cowell
Head Market Analyst
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