The euro fell earlier and we're seeing an impact on risk too now
A report on a possible budget meeting delay in Italy is enough to send risk scrambling across markets ahead of European trading. For much of the month, Italy has been a sideshow to markets but as always the case, things only matter when they matter. And right now, markets are saying that the focus on Italy is starting to matter.
The single currency took a bit of a hit while we're seeing risk start to shift as a result of the headline news. The yen and dollar remain bid while equities have now moved even lower on the day. The most telling part of the risk change though is that Italian headlines are weighing on Treasury yields.
10-year Treasury yields have fallen to a low of 3.041% now down 0.7 bps and that is helping to put a bid in the Japanese yen against the rest of the major bloc as well.
