- Powell: We are not confident that we've achieved sufficiently restrictive policy
- Powell Q&A: US economy has been stronger than expected this year
- Video: Jerome Powell speech interrupted by climate protestors
- US weekly initial jobless claims 217K vs 218K expected
- China's largest bank hit by ransomware attack that may have disrupted Treasury market
- Fed's Paese: Too soon to rule out further US rate hikes
- More from Fed's Paese:Not sure public expectations are aligned with likely Fed policy path
- BOC's Rogers: Canadians are feeling some pressure as they adjust to higher rates
- More from BOCs Rogers: BOC is not yet talking about reducing rates
- SNB Schlegel speaks on bank liquidity and risk
- Fed's Barkin: US economy is 'remarkably healthy'
- More from Barkin: I don't see us as done yet
- Israel will implement four-hour pauses in Gaza operations each day
- Fed's Bostic: We will remain restrictive until we're sure about 2% inflation
- ECB's Centeno: We are at a plateau in terms of interest rates
- ECB’s de Guindos: Any Discussion of Rate Cuts ‘Clearly Premature’
Markets:
- Gold up $8 to $1958
- WTI crude oil up 22-cents to $75.55
- US 10-year yields up 12.6 bps to 4.63%
- S&P 500 down 0.8%
- USD leads, AUD lags
The US dollar started the day on a soft note but reversed as Fed officials continued to emphasize rate-hike optionality. Powell re-emphasized only the hawkish points from last week's press conference in a speech, helping the US dollar. He was interrupted by climate protestors part of the way through and responded with profanity in a lighthearted moment.
No doubt there was some profanity at the Treasury as well, with a 5.7 bps tail in a bond auction in the worst showing since 2011. There was some talk of technical issues and ransomware as a potential explanation but yields haven't taken anything back and that likely puts in a floor in 10s at 4.50% until at least next week's CPI report.
The rebound in yields and risk aversion in stocks gave a strong late-day lift to the dollar, knocking EUR/USD 50 pips off the highs while USD/JPY climbed up to 151.30. It was a uniform move and helped to unwind some commodity currency strength in early North American trade.
Overall, it was a surprisingly lively trading day despite a lack of US economic data. The Nasdaq winning streak ended at 8 and that sets up an interesting Friday trade with UMich sentiment on the agenda.
