Markets:
- Gold up $16 to $2022
- WTI crude oil up $1.51 to $74.07
- US 10-year yields up 4 bps to 4.14%
- AUD leads, CHF lags
The day began with a hawkish tilt as US initial jobless claims fell once again — and on NFP survey week no less. That put an early bid in the US dollar and pushed up Treasury yields.
USD/JPY rose 25 pips to 148.30 were sellers stepped in and capped it the rest of the day. Moves elsewhere were smaller and later in the day, USD sellers stepped in on a few fronts.
Some of that may have been after the PCE comment from Timiraos. Earlier, the hawkish comment from Bostic found something of an audience as he’s a voter this year but ultimately it was nothing particularly new from him. Equities made a big move to the upside late and that lifted the commodity currencies and the pound.
The loonie remains near a four-week low but the bleeding stopped as oil found a bid in a nice $2 turnaround intraday. It’s the second day in a row of buying from North American traders after two weeks of non-stop selling.
Overall, the moves in the FX market were small but the selling of the US dollar on a day when yields rose was notable and may signal a trend change ahead. Equities certainly aren’t waiting.
