The dollar weakness continues
The GBP is the strongest and the USD continues its move to the downside. Yesterday the dollar was lower. For a reminder of the reasons, see Adam's post here. The moves today are relatively modest and split among the majors. The GBP, JPY and CAD are mostly stronger (or have a bias to the upside). The USD, NZD and CHF are mostly lower(or have a bias to the downside). The EUR and AUD are near unchanged.
The ranges and changes are showing EURUSD, GBPUSD, USDJPY, USDCHF and AUDUSD all barely traded below (or above) the zero line as dollar selling took hold from the start. The GBPUSD is leading the way to the upside with the move getting started in the Asian session and continuing the run higher since that time. The GBPUSD is approaching the highs from earlier in the month at 1.3185. The EURUSD gain is less than half of the gain in pips of the GBPUSD as it ran into the swing high from August 6 at 1.19153 and found sellers willing to sell against the risk defining level (the high reached 1.19144 and backed off a bit). The pair is still nearer the highs.
In other markets:
- spot gold is up $21 or 1.06% of 2006.32. Risk aversion buying continues in the precious metals today
- spot silver is up $0.70 or 2.55% of $28.18
- WTI crude oil futures are trading down $0.22 or -0.51% $42.67
In the premarket for US trading, the US stock futures are trading higher and implying a higher opening. Walmart and Home Depot both reported better-than-expected earnings in premarket. The futures are implying
- Dow industrial average is up 57 points
- NASDAQ, up 36 points
- S&P index, up 8 points
Iin the European stock market, the major indices are mostly higher after a mixed close yesterday. The UK's FTSE 100 is unchanged as the higher pound concerns investors:
- German DAX, +0.6%
- France's CAC, +0.25%
- UK's FTSE 100, unchanged
- Spain's Ibex, +0.6%
- Italy's FTSE MIB +0.6%
In the US debt market, yields are lower with the yield curve continuing to flatten. The 2-10 year spread came in around 2 1/2 basis points yesterday. It is about 1.5 basis points more narrow today as well.
In the European market the benchmark 10 year yields are mixed with Germany, France, UK, Spain marginally lower and Italy and Portugal marginally higher.
