Headlines:

Markets:

  • JPY leads, USD lag on the day
  • European equities a touch higher; S&P 500 futures down 0.1%
  • US 10-year yields down 2.6 bps to 3.618%
  • Gold up 0.3% to $2,522.42
  • WTI crude up 2.6% to $67.49
  • Bitcoin down 1.4% to $56,770

The most interesting part of the session was during the handover from Asia to Europe. That came as bond yields dipped and cast a bid on the Japanese yen in FX. USD/JPY in particular fell through to test 141.00 before touching a low of 140.70 during the day. The pair then caught a bounce back after, trading back up to 141.70 now but still down by 0.5%.

As yields fell, it put some light pressure on equities as well. S&P 500 futures fell as much as 0.6% before recovering most of that to be down just 0.1% now.

Focusing back on the bond market, 2-year Treasury yields flirted with a break to its lowest level in over two years. Yields were down by as much as 6 bps to 3.55% at one point, before keeping modestly lower now at 3.58%. 10-year yields on the other hand fell further to 3.61% and is keeping thereabouts.

With Treasury yields falling, the dollar is the laggard on the day as such. EUR/USD is up 0.3% to 1.1050 while USD/CHF fell to 0.8422 initially before rebounding back a little to 0.8460 now. Meanwhile, AUD/USD is also seen up 0.3% to 0.6670 on the day.

In other markets, gold is also starting to eye a further breakout as it hovers near the topside of its recent range. The precious metal is up 0.3% to $2,522 now, with buyers on the edge of their seats in wanting to chase a breakout.

That will be another area to watch out for as we turn the focus and attention to the US CPI report later.