Oil prices have dipped back below support at the $50.50 level, a sign that the recent rebound in commodities and commodity currencies predicated on a calmer global economic outlook may be coming to an end. A decline through $50 will further dampen spirits.
AUD and CAD have shed a good chunk of recent gains with AUD retracing more than 38.2% of its recent rally from 0.63 to nearly 0.71 and USD/CAD has bounced back to the 1.25 handle.
Risk aversion is back in command with optimism fading after the modest boomlet of recent weeks. Yields are lower in the US, as are stocks as optimism reverts to gloom amid the heavy hand of government taking the reins on Wall Street and in Detroit.
