Headlines:
Markets:
- JPY leads, USD lags on the day
- European equities higher; S&P 500 futures up 0.3%
- US 10-year yields down 9 bps to 3.943%
- Gold up 0.5% to $2,036.81
- WTI crude up 1.7% to $70.63
- Bitcoin up 0.3% to $43,136
The dollar continued its post-FOMC slump alongside Treasury yields, with 10-year yields notably dipping under 4% after having just hit 5% at the end of October. The quick shift in sentiment was exemplified by a more dovish Fed yesterday, which is still leading to the sell the dollar, buy everything else mood in markets.
USD/JPY dipped to 141.00 in Asia trading but is seen hovering around 141.40-80 in Europe, still down 0.9% on the day currently to 141.55. Meanwhile, other major currencies gradually advanced against the greenback with EUR/USD notably moving up from 1.0890 to 1.0930 ahead of the ECB meeting decision later.
The pound and franc were in focus too as we did have the BOE and SNB policy decisions during the session. Both central banks left policy unchanged and stuck with the status quo. The BOE’s hold sounded more hawkish especially when put against the backdrop of the Fed yesterday and that led to a slight rally in the pound.
GBP/USD moved up from 1.2660 to 1.2720 while EUR/GBP dropped from 0.8630 to 0.8590 as the BOE offers no pivot to markets and reaffirms that tighter policy is still necessary for the time being.
In other markets, equities continued to drive higher with the DAX and CAC 40 reaching fresh record highs in Europe. The ECB will be the next hurdle for stocks on the day in reaffirming whether or not the surging run this year can still keep going ahead of the Christmas period.