Well, the bounce in broader market sentiment from Friday is looking rather short-lived. After a decent start earlier today, we are now seeing markets revert back to old habits as stocks retreat and bond yields are ticking a little higher as well. S&P 500 futures were up around 18 points earlier in the transition from Asia to Europe but are now down 23 points instead.
Meanwhile, 10-year Treasury yields were down by over 7 bps earlier to 4.13% but have now climbed back up to 4.19% on the session.
In turn, this is keeping the dollar underpinned with USD/JPY having nearly erased all of the earlier intervention move by Japanese authorities as noted here. EUR/USD is also down 0.4% to 0.9824 amid sluggish PMI data, even if they are somewhat within estimates.
Elsewhere, GBP/USD is up 0.3% to 1.1337 but is down from around 1.1380 in the past two hours. The pound is finding some bit part relief after Boris Johnson dropped out of the race to become the next UK prime minister and as the political tug-of-war looks set to end with Rishi Sunak taking the seat.
Commodity currencies are also largely struggling with USD/CAD up 0.7% to 1.3740 and AUD/USD down 1.3% to 0.6290. The latter is falling back to take a run at its 100 and 200-hour moving averages at 0.6298 and 0.6284 respectively now.
