Headlines:
- Dollar stays in control so far on the day
- Fed's Barkin says has bias towards hiking rates more quickly, rather than more slowly
- BOE's Bailey: Inflation target is very important for the UK
- BOE's Tenreyro: We should be going slowly when there is a lot of uncertainty
- EU says will propose a cap on Russian gas
- Disappointing Chinese trade data adds to concerns on global outlook
- Eurozone Q2 final GDP +0.8% vs +0.6% q/q second estimate
- Germany July industrial production -0.3% vs -0.5% m/m expected
- UK August Halifax house prices +0.4% vs -0.1% m/m prior
Markets:
- USD leads, JPY lags on the day
- European equities lower; S&P 500 futures down 0.1%
- US 10-year yields down 0.6 bps to 3.334%
- Gold up 0.1% to$1,702.41
- WTI crude up 0.2% to $87.09
- Bitcoin down 1.3% to $18,730
The dollar is continuing its rampaging run higher as markets are seeing little alternatives to the current state of play. Equities are sluggish amid global economic concerns while bond yields are holding higher with Europe set to pile on debt to deal with the impending energy crisis in the region.
USD/JPY is a whisker away from 145.00, up over 200 pips today in a rather straightforward march to the key pyschological level. The capitulation is fueling the dollar advance, alongside a softer Chinese yuan - which is on approach towards 7.00 on the dollar.
Elsewhere, the euro remains sluggish and is looking to breach below 0.9900 against the greenback while GBP/USD is lurching towards the March 2020 low of 1.1409 - down 0.8% to 1.1425 currently.
Commodity currencies are also struggling with USD/CAD testing 1.3200 again while AUD/USD is down to near key support close to 0.6700 on the day. The Bank of Canada will be in focus for the former later today, so watch out for that.
With there being little else to work with for traders on the week, the dollar looks set to try and scale to new heights in the coming days unless Fed speakers have something to say about that before the FOMC blackout period and US CPI data next week.