- The USDIndex’s safe-haven gains fizzled and held at the low 106.00 area. Yields had plunged on the PPI data, but 5-year closed at 3.890%, the 2-year at 4.326%, and the 10-year at 3.772%, respectively. Stocks supported by cooler PPI but pressured afterwards as news of a Russian-made missile strike in Poland sparked fears of heightened geopolitical tensions. US President Biden who said the missile was unlikely to have been fired by Russia helped to calm nerves.
- EUR – retests once again the 1.040.
- JPY – holds at 139.50, while Risk-sensitive Antipodeans, AUDUSD is up at 0.6782, and NZDUSD at 0.6175. Australian wages boasted the largest rise in a decade last quarter as a super-tight labour market finally made itself felt, raising the risk of further rate hikes.
- GBP – steady at 1.1860 – UK CPI jumped to 11.1% y/y in October from 10.1% y/y in the previous month. Core inflation failed to decelerate as anticipated and held steady at 6.5% y/y.
- Stocks – closed in the green with gains of 1.45% on the US100, 0.87% on the US500, and 0.17% on the US30. But they are well off of early highs where the future showed the US100 knee-jerking nearly 3% on the data, while the US500 was up 1.9%, with the US30 up over 1.1%. Better than expected earnings/guidance from Walmart and hopes for a bounce in Chinese growth supported too.
- USOil – at $85.95
- Gold – jumps to 1787, but steady so far today.
Today: US Retail Sales and Canadian Inflation along.
Biggest FX Mover @ (06:30 GMT) EURJPY retested the 145.30 highs, MAs aligning higher, MACD line turned positive but signal line remains below 0, RSI 59 btu flattened. H1 ATR 0.391, Daily ATR 1.691.
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Andria Pichidi
Market Analyst
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