- Forex today has the DXY higher by 0.1% while risk sentiment was more elevated and balanced.
- US ten years climbed from 2.32% to 2.36% while higher betas were subdued.
Markets were confident that the House would pass the tax bill with results as follows: the US House voted 227-205 to overhaul the tax code. 13 Republicans voted no. However, markets now need to wait for the Senate Finance Committee's vote on tax reform and that is where things could all fall apart while senators have expressed serious misgivings over the cost and effect on the middle class. This may not take place until after Thanksgiving though, (Thanksgiving is 23rd November).
US 10yr treasury yields climbed from 2.32% to 2.36%, while the 2yr yields made another nine-year high moving from 1.69% to 1.71%. Fed fund futures yields continued to price the chance of a December rate hike at almost 100%. Within the improved risk sentiment, US stocks bounced amid solid company earnings but the yen was not persuaded above the 113 handle until late in the shift when the hourly cluster of MA's resisted.
USD/JPY fell from 113.30 in European trade down to 112.73 on the morning of the NY shift where it bounced to 113.07 the high. The euro was consolidating recent gains between a range of 1.1760-1.1800. GBP/USD was unable to capitalise on the UK data where retail sales beat expectations or the noise that PM May will increase the Brexit exit payment. The UK data showed that there was a modest m/m growth of 0.3% in October betaing 0.1% consensus. Sterling failed at 1.3205 as a triple top but stayed in a range of 1.3180-1.3208 for the best part of the US shift. BoE's Carney said that there will likely be just two more rate hikes in coming years, anchoring the pound while the cross kept to a 0.8967-0.8913 range. As for the antipodeans, AUD/USD ranged sideways between 0.7580 and 0.7602 while the Kiwi dropped to 0.6836 before recovering to 0.6866.
Key events in Asia:
Analysts at Westpac noted that Manufacturing PMI has been elevated for some time. Q3 PPI holds little interest since it has been superceded by Q3 CPI.
Key notes:
- Wall Street ends day with substantial gains on improved sentiment
- Fed's Mester: Inflation likely to hit two percent target by end of 2018
- Dollar Index approaches daily highs after US House vote on tax cuts
- US House passes sweeping tax legislation, sending measure to Senate - Reuters
- Fed's Kaplan: There's no question cyclical pressures on inflation are building
- Fed's Kaplan: If unemployment rate rises, that could be sign of a coming recession
- US: Homebuilder confidence extends gains in November - Wells Fargo
- Market is underestimating the extent of next year's Fed tightening? - Scotiabank
- Crude oil prices holding at the lower end of their weekly ranges
- US Industrial Production: Noisy data masks underlying improvement - Wells Fargo
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
AUD/USD: The hunt for the 0.7000 hurdle
AUD/USD quickly left behind Wednesday’s strong pullback and rose markedly past the 0.6900 barrier on Thursday, boosted by news of fresh stimulus in China as well as renewed weakness in the US Dollar.
EUR/USD refocuses its attention to 1.1200 and above
Rising appetite for the risk-associated assets, the offered stance in the Greenback and Chinese stimulus all contributed to the resurgence of the upside momentum in EUR/USD, which managed to retest the 1.1190 zone on Thursday.
Gold holding at higher ground at around $2,670
Gold breaks to new high of $2,673 on Thursday. Falling interest rates globally, intensifying geopolitical conflicts and heightened Fed easing bets are the main factors.
Bitcoin displays bullish signals amid supportive macroeconomic developments and growing institutional demand
Bitcoin (BTC) trades slightly up, around $64,000 on Thursday, following a rejection from the upper consolidation level of $64,700 the previous day. BTC’s price has been consolidating between $62,000 and $64,700 for the past week.
RBA widely expected to keep key interest rate unchanged amid persisting price pressures
The Reserve Bank of Australia is likely to continue bucking the trend adopted by major central banks of the dovish policy pivot, opting to maintain the policy for the seventh consecutive meeting on Tuesday.
Five best Forex brokers in 2024
VERIFIED Choosing the best Forex broker in 2024 requires careful consideration of certain essential factors. With the wide array of options available, it is crucial to find a broker that aligns with your trading style, experience level, and financial goals.