Headlines:
- Flailing German economy fails to breath confidence in the euro
- France October flash services PMI 46.1 vs 44.6 expected
- Germany October flash manufacturing PMI 40.7 vs 40.0 expected
- Eurozone October flash services PMI 47.8 vs 48.7 expected
- Germany November GfK consumer sentiment -28.1 vs -26.6 expected
- UK October flash services PMI 49.2 vs 49.3 expected
- UK August ILO unemployment rate 4.2% vs 4.3% expected
- ECB's Lagarde to EU officials: Inflation fight is going well
- ECB's Makhlouf: Far too early to tell consequences of Middle East situation
- RBA's Bullock: Australian dollar relatively stable, not a concern for policy
- We are going to see higher interest rates for longer - Larry Fink
- Loan demand by firms and households continue to decline sharply - ECB survey
Markets:
- AUD leads, EUR lags on the day
- European equities higher; S&P 500 futures up 0.5%
- US 10-year yields up 2.3 bps to 4.861%
- Gold down 0.6% to $1,961.07
- WTI crude up 0.3% to $84.75
- Bitcoin up 4.1% to $34,458
Falling yields were the highlight yesterday and it threatened to be that way early on today as well. 10-year Treasury yields dipped to a low of 4.80% before recovering to around 4.86% currently and that took the dollar along with it for the ride.
Instead, the euro was the highlight as it slumped during the session after a weak set of PMI readings from France and Germany in particular. EUR/USD held around 1.0690 early in the session before reversing to hit a low of 1.0623 and is holding just above that on the day.
The single currency remains the weakest performer while risk trades are keeping the turnaround from yesterday and pushing higher today. S&P 500 futures are up 0.5% while European indices are holding modest gains so far on the day.
That is helping to keep the aussie underpinned, with AUD/USD up 0.5% to 0.6365. Besides that, other major currencies remain more muted although we did see GBP/USD fall off as well from a high of 1.2280 to 1.2210 on the session after is own PMI data and dollar recovery.
In other markets, gold is seen tracking lower and looks poised for back-to-back daily losses for the first time in three weeks. Perhaps there is some further unwinding of safety flows at play there. Meanwhile, Bitcoin continues to surge with over 4% gains now to $34,458 after briefly clipping the $35,000 mark earlier in the day.
