Analysts at Westpac offered a market wrap.
Key Quotes:
"Global market sentiment: Equity markets firmed slightly, the US dollar stabilised, and US interest rates rose. European growth and survey data was strong, and US Administration officials signalled fiscal stimulus.
Interest rates: US 10yr treasury yields rose from 2.22% to 2.29%, 2yr yields from 1.27% to 1.31%. Fed fund futures yields remained firm, pricing a June rate hike as a 90% chance.
FOMC dove Kashkari saw the economy close to full employment but inflation still lagging, leaving him unconvinced about a June rate hike. He agreed with the consensus view balance sheet reduction should start by year end. Treasury Sec. Mnuchin spoke after Trump’s Budget, reaffirming a commitment to tax cuts, and downplaying border adjustment taxes.
Currencies: The US dollar index is 0.4% higher on the day, bouncing off a six-month low. EUR fell from 1.1268 to 1.1180. USD/JPY rose from 110.91 to 111.86. AUD initially rose to a multi-week high at 0.7517 before the US dollar’s stabilisation caused a reversal to 0.7474. NZD again outperformed (probably related to tomorrow’s Budget), rising from 0.7000 to 0.7047 (a one-month high) before completely retracing. AUD/NZD extended a multi-day decline to 1.0646 before rebounding to 1.0680."
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