Forex news for North American trade on October 12, 2021:
- Fed's Clarida: Gradual taper concluding mid-2022 may soon be warranted
- US August JOLTS job openings 10.439m vs 10.925m expected
- Fed's Bostic says he's comfortable beginning taper in November
- Bostic: Underlying inflation is indeed above committees objective
- More from Fed's Bostic: Fed is going to be more comfortable with a bit more volatility in inflation
- US sells $38 billion of 10 year notes at a high yield of 1.584%
- US sells 3-year notes at 0.635% vs 0.637% WI
- IMF fractionally downgrades 2021 GDP, leaves 2022 unchanged
Markets:
- WTI crude oil up 4-cents to $80.58
- US 10-year yields down 3.5 bps to 1.57%
- S&P 500 down 17 points to 4343
- Gold up $7 to $1760
- CAD leads, CHF lags
The early trade in New York was a mess as the dollar initially sank, then roared back as USD/JPY tagged new seven-year highs then faded again only to grind to better levels late. It was a messy set of moves that never quite established a theme.
In fixed income, there was a bull flattener as 30-year yields fell 7.2 basis points and are now 10 bps from Friday's post-payrolls high. The dip comes with energy flattening out and US equities on the back foot, though not materially.
It's tempting to chalk it all up to the ebb and flow.
The dominant feature in FX remains yen weakness. That continued in Asia and Europe but was halted in New York and retraced ever-so-slightly.
Economic news was largely ignored as Clarida and Bostic repeated old positions and JOLTS showed a softening of job openings. That will change tomorrow with the US CPI report.
