Headlines:
- Dollar down as Trump picks Scott Bessent for role of Treasury secretary
- Weekly update on interest rate expectations
- Reminder: It will be a holiday-shortened week in the US
- ECB's Lane: Monetary policy should not remain restrictive for too long
- BOE's Lombardelli: I support a gradual removal of monetary policy restriction
- BOE's Lombardelli: We remain focused more on services prices and wages
- BOE's Dhingra: UK no longer looks like an outlier for inflation among advanced economies
- SNB total sight deposits w.e. 22 November CHF 459.4 bn vs CHF 463.4 bn prior
- Germany November Ifo business climate index 85.7 vs 86.0 expected
Markets:
- EUR leads, USD lags on the day
- European equities mixed; S&P 500 futures up 0.4%
- US 10-year yields down 4.1 bps to 4.368%
- Gold down 1.0% to $2,684.93
- WTI crude down 0.1% to $70.71
- Bitcoin up 0.2% to $98,195
There wasn't much action in European morning trade as the broader market moves largely came right at the opening bell in Asia Pacific earlier today.
The main story over the weekend was Trump's pick for Treasury secretary and in naming Scott Bessent for the role, markets are taking that as a safe pair of hands in toning down Trump's extremism. Here is a recap of Bessent's recent remarks on various key topics that have been captivating markets' attention as of late.
The dollar opened with a gap lower and while it did fill the gap against some major currencies during the session, the greenback is still ending up on the softer side as we look towards North America trading.
EUR/USD held gains for the most part, hovering around 1.0470-80 levels and is up 0.6% on the day. USD/JPY is down 0.2% to 154.45 but is keeping lightly changed, having pushed up to 154.70 during the session at one point. Meanwhile, GBP/USD is up 0.2% to 1.2560 and USD/CHF down 0.4% to test the 0.8900 mark on the day.
The commodity currencies are not really capitalising on the dollar softness today. USD/CAD is now flat at 1.3978 and AUD/USD likewise at 0.6500 on the day. That despite a more positive risk sentiment, with US futures cheering on Bessent's appointment.
European indices caught the optimistic bug in the early stages but that has dissipated with the DAX and CAC 40 now being closer to flat levels on the day. As for bonds, they are more bid amid an opening gap higher after Trump's pick. But as the session muddled along, we are seeing yields push back up from the lows. 10-year yields in the US fell to as low as 4.33% earlier but are now back up to near 4.37% on the day.
Elsewhere, gold is in retreat mode with some profit-taking also arguably in the works. Price did fall to a low of $2,658 before the drop was arrested by a defense of its 100-hour moving average. That led to a marginal bounce to around $2,684 currently, still down roughly 1% today.
