Markets Weaker-than-expected US retail sales triggered a rally in Treasuries. Yields declined between 4.1 and 6.2 bps in what was otherwise a dull trading session. German rates still finished marginally in the green, adding up to 2.5 bps at the front. UST outperformance dragged the dollar lower against all major peers. The trade-weighted USD index…
Dollar closed the week broadly lower, with the only exception being its slight gains against the even weaker Yen. Risk-on sentiment dominated global markets, fueling strong rallies in equities across the US, Europe, and Hong Kong, which in turn kept the greenback under pressure. The greenback had previously enjoyed a tariff-driven boost earlier in the…
In the coming week, the key scheduled macroeconomic events include rate decisions in Australia and New Zealand, Canadian inflation data, and Flash PMIs for Europe. On February 18th, the Reserve Bank of Australia (RBA) is expected to cut the key rate for the first time in this monetary cycle. Australia has been less aggressive in…
Markets US yields easily returned most of Wednesday’s rise incurred after stronger than expected January CPI data. The move is telling on the current market positioning/assessment. The ‘correction’ started after and despite higher than expected US January PPI data. Markets apparently concluded that the bar is extremely high for the Fed to consider raising rates…
Eurozone investor sentiment showed signs of improvement in February, with the Sentix Investor Confidence Index rising from -17.7 to -12.7, surpassing expectations of -16.4. This also marks the highest reading since July 2024, signaling a tentative shift in market sentiment. Current Situation Index also improved, climbing from -29.5 to -25.5, while Expectations Index made an…
Dollar faced significant volatility last week as shifting trade policy signals from the White House left investors scrambling for clarity. Initially, tariffs on Canadian and Mexican imports were imposed, only to be quickly suspended for 30 days following new agreements on border security and fentanyl control. Now, the focus turns to “reciprocal tariffs,” a move…
Eurozone PPI increased by 0.4% mom in December, slightly below market expectations of 0.5% MoM. On a year-over-year basis, PPI was unchanged, above expectations of a -0.1% yoy decline. Breaking down the monthly price changes in Eurozone, energy prices saw the biggest increase at 1.4%, followed by durable consumer goods (+0.2%). Capital goods, intermediate goods,…
Headline hunting about the latest on Trump and his tariff threats is what traders are up to. The news of a month of delay for the tariffs targeting Mexico landed soon after the US opening bell and similar news about Canada came in later in the day. As such, by the end of Monday, both…
Eurozone CPI rose from 2.4% yoy to 2.5% yoy in January, above expectation of 2.4% yoy. CPI core (ex-energy, food, alcohol & tobacco) was unchanged at 2.7% yoy, above expectation of 2.6% yoy. Looking at the main components, services is expected to have the highest annual rate in January (3.9%, compared with 4.0% in December),…
Summary United States: Economic Momentum Holding, for Now The economy ended 2024 on a solid note with a 2.3% Q4 increase in real GDP. Volatile inventory swings lowered the headline, but real final sales to domestic private purchasers rose by a robust 3.2%. Fervent consumer spending continues to drive economic activity, while inflation is receding…