As the new trading week begins, the CHF is the strongest and the USD is the weakest. However, all the major currencies are scrunched together in what is a quiet open for the trading week. The largetst low to high trading range for the major currencies 40 pips (GBPUSD). THe EURUSD only has a 22 PIP trading range, the NZDUSD and USDCHF only 23 pips and the AUD is at 25 pips. All are less than 50% of the normal range seen over the last month of trading. In other words, the week is off to a slow start.
This week, however, will be highlighted by central bank rate decisions by the Fed (Wednesday), Swiss National Bank (Thursday), Bank of England (Thursday), and Bank of Japan (on Friday). The Federal Reserve is expected to maintain rates at the current 5.5%, although it could signal the potential for an additional rate hike before year end. At the meeting, the Fed will also announce their.dot plot, and central tendencies for inflation, employment, and GDP going forward.
The Swiss National Bank in the Bank of England are expected to raise rates by 25 basis points respectively. The Bank of Japan is expected to leave rates on hold at -0.1% on Friday, but traders will be watching closely for hints about the policy outlook after Governor Kazuo Ueda. Ueda stoked speculation of an imminent move away from ultra-loose policy last week, however after The USDJPY moved sharply on Monday, the pair gradually retraced all its declines (lower JPY), closing near the high for the week and little changed.
US stock futures are trading in negative territory with the NASDAQ shedding the most in premarket trading. On Friday, the NASDAQ index fell -1.56% while the S&P fell -1.22% to tilt the week to the downside. Instacart is expected to go public today with its IPO.
US yields are 1-3 basis points higher today after rising last week. The 2 year yield this morning reached the highest level since December 2000. The 10 year yield this morning reached the highest level since November 2007.
That UAW is now into its 4th day.
A snapshot of the markets as the NA session gets underway shows:
- Crude oil is trading down $0.34 or -0.36% at $90.44.. Lastly crude prices moved up 3.73%. Weight price has been up for 3 consecutive weeks
- Spot gold is trading of $3.11 or 0.16% at $1926.57. Gold prices rose a modest 0.29% last week
- Spot silver is trading up $0.10 or 0.44% $23.14
- Bitcoin is trading at $27,160. At this time on Friday, the price was trading at $26,471. The high price today reached $27,238 the highest level since August 31
In the US premarket for US stocks, major indices are trading lower after the broader S&P and NASDAQ index tumbled on Friday.
- Dow Industrial Average futures are implying a decline of -62 points after falling -288.87 points on Friday
- S&P index futures are implying a fall of -11 points after tumbling 54.78 points or -1.22% on Friday
- NASDAQ futures are implying a decline of -63 points points after tumbling -217.72 points or -1.56% on Friday.
In the European equity markets, the major indices are also trading lower across the board:
- German DAX, -0.90%
- France’s CAC, -1.26%
- UK’s FTSE 100, -0.45%
- Spain’s Ibex, -0.62%
- Italy’s FTSE MIB, -0.93% (delayed)
In the Asian Pacific today, equity markets closed mixed
- Japan’s Nikkei 225, rose 1.10%. Last week the index fell -0.32%
- China’s Shanghai Composite, rose 0.26%. Last week the index was little changed
- Hong Kong’s Hang Seng, fell -1.39%. Last week the index fell -0.11%
- Australia’s S&P/ASX 200, fell -0.67%. Last week the index rose 0.70%
In the US debt market, yields are higher
- 2-year yield, 5.058% up 2.5 basis points
- 5-year yield, 4.479% up 2.6 basis points
- 10-year yield, 4.340% up 1.8 basis points
- 30-year yield, 4.420% up 0.9 basis points
In the European debt market, benchmark 10-year yields are trading higher. The German 10 year is skimming close to the high yield for the year at 2.77%. The current yield is trading at 2.692%. France 10 year yields are also near its high yield of 3.285%.