Markets:
Gold up $5 to $1723
US 10-year yields down 15 bps to 2.75%
WTI crude down $1.69 to $94.69
S&P 500 down 1.0%
JPY leads, CAD lags
The bond market is signaling much less concern about inflation and extra about progress. Yields proceed to fall dramatically in an indication that bonds have seen sufficient mountain climbing to cost out inflation with the rising chance {that a} onerous touchdown is on the best way.
A lot of the worries are targeted on Europe however right this moment’s US providers PMI was the worst since 2009 other than a number of months in the course of the pandemic. It was far under estimates and initially prompted USD promoting on fewer Fed hikes however ultimately transitioned to a traditional ‘danger off’ transfer on worries about international progress.
That despatched commodity currencies on a experience as they initially strengthen however then fully reversed to complete the day decrease. The euro and pound have been caught in the identical greenback rollercoaster as they initially benefited solely to provide all of it again.
The regular winner was the yen because the market begins to ascertain the remainder of the world again within the low-inflation, low-growth lure that the BOJ has been scuffling with for many years. USD/JPY fell 100 pips however yen crosses fell additional.
