• Gold up $8 to $1958
  • WTI crude oil up 22-cents to $75.55
  • US 10-year yields up 12.6 bps to 4.63%
  • S&P 500 down 0.8%
  • USD leads, AUD lags

The US dollar started the day on a soft note but reversed as Fed officials continued to emphasize rate-hike optionality. Powell re-emphasized only the hawkish points from last week's press conference in a speech, helping the US dollar. He was interrupted by climate protestors part of the way through and responded with profanity in a lighthearted moment.

No doubt there was some profanity at the Treasury as well, with a 5.7 bps tail in a bond auction in the worst showing since 2011. There was some talk of technical issues and ransomware as a potential explanation but yields haven't taken anything back and that likely puts in a floor in 10s at 4.50% until at least next week's CPI report.

The rebound in yields and risk aversion in stocks gave a strong late-day lift to the dollar, knocking EUR/USD 50 pips off the highs while USD/JPY climbed up to 151.30. It was a uniform move and helped to unwind some commodity currency strength in early North American trade.

Overall, it was a surprisingly lively trading day despite a lack of US economic data. The Nasdaq winning streak ended at 8 and that sets up an interesting Friday trade with UMich sentiment on the agenda.

FX news wrap Nov 9