Headlines:
- Dollar down slightly as the bond selling comes off the boil for now
- The bond rout cools off a little, for now at least
- ECB's Centeno: Inflation is falling faster than when it was rising
- Eurozone August retail sales -1.2% vs -0.3% m/m expected
- Eurozone August PPI +0.6% vs +0.6% m/m expected
- Eurozone September final services PMI 48.7 vs 48.4 prelim
- UK September final services PMI 49.3 vs 47.2 prelim
- US MBA mortgage applications w.e. 29 September -6.0% vs -1.3% prior
- Saudi Arabia reaffirms will continue voluntary oil output cuts until end of December
Markets:
- GBP leads, NZD lags on the day
- European equities higher; S&P 500 futures up 0.1%
- US 10-year yields down 1.5 bps to 4.787%
- Gold up 0.1% to $1,824.08
- WTI crude down 2.0% to $87.47
- Bitcoin up 0.7% to $27,580
As we got into European morning trade, yields were running hot once again and we saw 10-year Treasury yields hit 4.88%. That kept the dollar more bid while equities were smashed lower, with S&P 500 futures marked down by 0.6%.
But as the session trudged along, yields reversed lower in a welcome relief for broader markets after yesterday's moves.
The greenback lost ground and is sitting lower on the day while S&P 500 futures turned things around to be up 0.1% currently, as 10-year Treasury yields fall down to 4.78%.
It's a bit part relief for the most part and perhaps a tentative one as we still have US trading to navigate through.
EUR/USD moved up from 1.0460 to 1.0500 while AUD/USD recovered some poise from 0.6290 to 0.6320-30 currently. Meanwhile, despite Tokyo intervention, USD/JPY is largely steady at around 148.95 but was hovering closer to 149.10-20 levels earlier in the day.
With US ADP employment data coming up, the focus stays on the bond market (and how that impacts broader sentiment) still ahead of the Friday jobs report.
