The dollar index is starting the week trading at the highest level since early 2002. The USD is the strongest of the major currencies while the AUD and NZD suffer on the back of risk off sentiment . Recall from Friday, the US jobs report showed continuous robust job demand and growth. On Wednesday, the US CPI's is expected to continue its upward trajectory with a gain of 1.1% for the MoM headline number. The core measures expected to rise by 0.6%. That should solidify the Fed's July rate increase at 0.75 basis points. It would take the target rate to 2.25% – 2.5% which many Fed officials called the neutral rate. Expectations are by the end of the year, the Fed will raise rates closer to a 3.5%. Meanwhile, The USDJPY is trading to yet another high going back to September 1998. Bank of Japan's Kuroda said that the central bank won't hesitate to take additional monetary easing steps as necessary, and Japan's ruling coalition expanded its majority over the weekend. This is another indication that the general public is in favor of the easy monetary policy in Japan.
This week the Reserve Bank of New Zealand and the Bank of Canada expected to raise rates at their latest meetings. The earnings calendar in the US will begin.
The US and European stocks are trading lower. Elon Musk backed out of his Twitter bid. Let the lawsuits begin. US yields are also lower after Friday's rise. Last week the yields moved up by about 25 basis points in the shorter end as the market further priced in a tighter Fed trajectory.
Looking at other markets:
- Spot gold is down $-6.41 or -0.37% $1735.38.
- Spot silver is trading down $0.09 or -0.45% $19.20.
- WTI crude oil futures are trading down $2.50 at $102.24
- The price bitcoin moved down over the weekend and trades at $20,437.62. On Friday, the price closed at $21,584
In the premarket for US stocks, the major indices are lower after gaining last week with the NASDAQ index rising the most at +4.56%:
- Dow industrial average is trading down -164 point points after Friday's -40 614 point decline
- S&P index is trading down -25 points after Friday's -3.26 point decline. Friday's loss snapped a 4 day rise
- NASDAQ index is trading down 101 points after Friday's 13.96 point rise. The NASDAQ index is up 5 consecutive days
In the European equity markets, the major indices are all trading lower to start the trading week. Concerned about growth continue to weigh on European economies. This week, Russia is to take the Nord Stream pipeline down for scheduled maintenance.
- German DAX, -109 points or -0.04%
- France's CAC -37.51 points or -0.62%
- UK's FTSE 100 -20.8 points or -0.29%
- Spain's Ibex -14.02 points or -0.17%
- Italy's FTSE MIB, -61 points or -0.29% him him him
In the US debt market, the major indices are trading lower
In the European debt market, yields are also lower with France's 10 year yield down -6.7 basis points leading the way
