- US auctions $38B of 10 year notes at a high yield of 4.438%
- Timiraos: Fixation on dot plot obscures 'remarkable cohesion' on the Fed's stance
- Fitch: France snap election increases fiscal and reform uncertainty
- EIA raises its forecast for 2024 and 2025 world oil demand
- World Bank boosts 2024 global GDP growth forecast to 2.6% from 2.4%
- ECB's Makhlouf: I'm not uncomfortable with little-more than one rate cut this year
- Canada April building permits +20.5% vs +2.2% expected
- Hunter Biden found guilty on all three counts in gun trial
- Preview: Eyes will be on every detail of the May CPI report
Markets:
- Gold up $5 to $2315
- US 10-year yields down 7 bps to 4.398%
- WTI crude oil up 31-cents to $77.96
- S&P 500 up 0.2%
- NZD leads, EUR lags
The calendar was light ahead of tomorrow's CPI report and FOMC decision but the early mood was cautious as European markets were risk averse on political uncertainty. That led to a dollar bid and a five-week low in the euro. US equities also started off weak as tech stocks excluding Apple shares fell.
The mood turned mid-day after a surprisingly strong auction of $39 billion in 10-year notes. All the elements were in place for a tail but the strength sent a signal to the markets that bonds aren't overly worried about inflation or the Fed, or at least that's the message the rest of the market wanted to hear.
The US dollar fell modestly initially but then the selling picked up, particularly with Apple shares indicating that AI-driven trades aren't done yet. As the dust settles, the dollar selling basically unwound earlier buying aside from a couple spots. It leave the market more-balanced as we head into a big day.
