Headlines:
- Gold and oil fall back as safety flows unwind again after the weekend
- Bond yields nudge a little higher on the day
- ECB's Kazimir: Additional tightening could come if incoming data forces us to
- ECB's Simkus: Unless there are data surprises, current level of restriction is sufficient
- Spain October preliminary CPI +3.5% vs +3.5% y/y prior
- Germany Q3 preliminary GDP -0.1% vs -0.3% q/q expected
- Saxony October CPI +4.5% vs +5.4% y/y prior
- Bavaria October CPI +3.7% vs +4.1% y/y prior
- Eurozone October final consumer confidence -17.9 vs -17.9 prelim
- UK September mortgage approvals 43.33k vs 45.00k expected
- Switzerland October KOF leading indicator index 95.8 vs 95.0 expected
- SNB announces changes to remuneration of sight deposits
- Reminder: The clocks went back in Europe on Sunday
Markets:
- AUD leads, CHF lags on the day
- European equities higher; S&P 500 futures up 0.7%
- US 10-year yields up 4.7 bps to 4.892%
- Gold down 0.7% to $1,992.40
- WTI crude down 1.3% to $84.41
- Bitcoin up 2.1% to $34,576
It is shaping up to be a bit of a mixed start to the new week but it seems like the most dominant theme is the easing of safety bets from the end of last week. The Israel-Hamas conflict continues to rage on in the background but mostly centered around the Gaza Strip. While doleful, it isn't really impacting global markets all too much for now at least.
And for the third Monday in a row, both gold and oil look set for a drop to start the week. Meanwhile, equities are catching a relief bid but could still face struggles later when Wall Street enters the fray. In the bond market, yields are higher but that hasn't been of much help to the dollar today.
EUR/USD moved up slightly from 1.0550 to 1.0590 levels now, helped out by a slight better German Q3 GDP reading. USD/JPY while now little changed at 149.70 did see a drop earlier to 149.30, before finding some near-term support at the level.
The greenback is trading marginally lower as it trails against the commodity currencies on the back of a better risk mood overall. AUD/USD is up 0.7% to 0.6377 but the pair is still largely caught in a downwards channel as pointed out here.
As we look to the day ahead and to tomorrow, month-end flows will also be a consideration and that could keep the waters a little murkier before we get a better picture of things come November.
