Market News Today – It was all about Treasuries again as yields continue to drop, and despite the rates tumbling to the lowest since March 3, ahead of the CPI data there was stellar demand for the 10-year auction.

10-year Treasury yields have dropped back a further -1.0 bp below 1.50% for the first time since March. Bearish positioning in Treasuries seems to be more extreme than initially thought. Bond markets across the Asia-Pacific region also found buyers, leaving the 10-year JGB rate down -0.1 bp at 0.060% and Australia’s 10-year rate down -8.9 bp at 1.48%. The September 10-year Bund future is up 7 ticks, while in cash markets the 10-year Treasury yield has dropped -1.2 bp to 1.48%.

Chart

Short covering and technicals remained big factors behind the move as bond bears threw in the towel on bearish inflation and Fed tapering bets.

Stock markets have been more cautions but benefited from the drop in yields, and indexes are mostly higher, while today the stocks are still in green with GER30 and UK100 futures up 0.1% and 0.3% at the moment and US futures also posting fractional gains, with indexes already at very high levels. JPN225 has gained 0.3%, the ASX is up 0.5% and Hang Seng and CSI 300 are 0.4% and 0.9% higher on the day.

Today The ECB meeting takes center stage. The ECB is expected to keep the overall policy framework unchanged on Thursday, but review monthly purchase volumes under the PEPP program, which were “significantly” enhanced through Q2 as Europe fought with another surge of infections and a slow vaccine rollout. The US calendar will be of interest today, with the key May CPI report due.

Chart

Biggest FX Mover – GBPJPY drops to the 154 level, after it opened the day below the 20-day MA. It has posted a reversal from 156 highs since the end of May. Next key Support is at 153.45, which is a confluence of May’s floor and lower BB pattern.

Disclaimer: Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of purchase or sale of any financial instrument.

Feed news

Latest Forex Analysis


Latest Forex Analysis

Editors’ Picks

EUR/USD struggles around 1.19 amid Fed-fueled dollar strength

EUR/USD is under pressure around 1.19, as the dollar remains on the offensive following the Federal Reserve's hawkish decision on Wednesday. The bank is set to debate cutting down its bond buys and signaled raising rates sooner than anticipated. 

EUR/USD News

GBP/USD tumbles below 1.39 on weak UK data, dollar strength

GBP/USD has been extending its decline, sliding under 1.39. UK retail sales disappointed with -1.4% in May and the rapid spread of the Delta variant in the UK is also weighing on sterling. The US dollar remain robust after the Fed's hawkish decision.

GBP/USD News

GBP/USD tumbles below 1.39 on weak UK data, dollar strength

GBP/USD has been extending its decline, sliding under 1.39. UK retail sales disappointed with -1.4% in May and the rapid spread of the Delta variant in the UK is also weighing on sterling. The US dollar remain robust after the Fed's hawkish decision.

GBP/USD News

Ripple fears of a major decline are unwarranted

XRP price remains locked in a range between the psychologically important $1.00 and the neckline of a multi-year inverse head-and-shoulders pattern at $0.76. However, a lack of technical clues leaves frothy forecasts on the sideline until directional confirmation can be gleaned from the charts.

Read more

Where next for markets after the Fed shocker

The Fed surprised markets with an abrupt hawkish shift that has triggered substantial volatility in currency markets. Valeria Bednarik and Yohay Elam explain the surprise, discuss technical level, the next moves in FX and beyond.

Read more

Majors

Cryptocurrencies

Signatures