Headlines:

Markets:

  • JPY leads, AUD lags on the day
  • European equities lower; S&P 500 futures down 0.1%
  • US 10-year yields up 4.3 bps to 3.466%
  • Gold flat at $1,702.13
  • WTI crude down 0.7% to $86.72
  • Bitcoin down 0.1% to $20,210

It was a calmer setting today after some big moves yesterday following the US CPI data release, which came in hotter than expected. The dollar is sitting more mixed but is staying in a good spot after the advance yesterday while equities were holding its ground earlier only to fall now ahead of US trading.

The notable mover was USD/JPY as Japanese officials continue to verbally intervention, with reports also pointing to the BOJ conducting a rate check when the pair hit 144.90 earlier in Asia trading. It has been one-way traffic since the pair neared 145.00 again, as it retreated to briefly below 143.00 and is now just above that now - down 0.9% to 143.20 levels.

The euro and pound steadied themselves after the sharp fall yesterday with UK headline annual inflation easing from double-digits but core inflation continued to push higher. EUR/USD stuck around 0.9980-10 mostly with parity keeping a lid on price action for now as large expiries are seen at the key level.

Elsewhere, commodity currencies aren't faring too well as risk sentiment stutters with S&P 500 futures being down 0.1% now after having been up 0.6% earlier in the day. USD/CAD is moving up 0.2% to test 1.3200 again while AUD/USD is down 0.3% to 0.6710 near the lows for the day.

It's still all about the outlook to the Fed next week and the question for markets now is how serious is the idea of a 100 bps rate hike. I still think that's a bit of a reach for the Fed but I wouldn't rule out a continued squeeze before the meeting in the week ahead.