As the new trading week begins, the CHF is the strongest and the USD the weakest. However, all major currencies are gathered together in what makes for a quiet opening to the trading week. Largest low to high trading range for major currencies 40 pips (GBPUSD). EURUSD only has a trading range of 22 pips, NZDUSD and USDCHF only 23 pips and AUD is at 25 pips. All are within 50% of the normal range seen over the last month of trading. In other words, the week is off to a slow start.
This week will, however, be marked by decisions on central bank rates from the Fed (Wednesday), the Swiss National Bank (Thursday), the Bank of England (Thursday) and the Bank of Japan (Friday). The Federal Reserve is expected to keep rates at the current level of 5.5%, although it could signal the possibility of another rate hike before the end of the year. At the meeting, the Fed will also announce its .dot chart and central trends for inflation, employment and GDP going forward.
The Swiss National Bank and the Bank of England are expected to increase their rates by 25 basis points respectively. The Bank of Japan is expected to leave rates unchanged at -0.1% on Friday, but traders will closely watch cues on the political outlook following Governor Kazuo Ueda’s announcement. Ueda fueled speculation about an imminent abandonment of ultra-accommodative policy last week, but after USDJPY moved sharply on Monday, the pair gradually retraced all its declines (JPY decline), closing near the high of the week and little change.
U.S. stock futures are trading in negative territory, with the NASDAQ losing the most in premarket trading. On Friday, the NASDAQ index fell -1.56% while the S&P fell -1.22% to tip the week lower. Instacart is expected to go public today with its IPO.
U.S. yields are up 1 to 3 basis points today after rising last week. The 2-year yield reached this morning its highest level since December 2000. The 10-year yield reached this morning its highest level since November 2007.
The UAW is now on its fourth day.
A snapshot of the markets as the NA session gets underway shows:
- Crude oil is trading down $0.34 or -0.36% at $90.44. Finally, crude prices increased by 3.73%. The price of weight has been increasing for 3 consecutive weeks
- Spot gold is trading up $3.11 or 0.16% at $1,926.57. Gold prices rose modestly by 0.29% last week
- Spot silver trades up $0.10 or 0.44% $23.14
- Bitcoin is trading at $27,160. At this time on Friday, the price was trading at $26,471. The high price reached $27,238 today, the highest level since August 31.
In U.S. stock premarket trading, major indexes are trading lower after the broader S&P and NASDAQ indexes fell on Friday.
- Dow Industrial Average futures imply a -62 point decline after falling -288.87 points on Friday.
- S&P index futures imply a -11 point decline after falling 54.78 points or -1.22% on Friday.
- NASDAQ futures imply a -63 point decline after falling -217.72 points or -1.56% on Friday.
On the European stock markets, the main indices are also trading down:
- German DAX, -0.90%
- CAC France, -1.26%
- British FTSE 100, -0.45%
- Spanish ibex, -0.62%
- Italian FTSE MIB, -0.93% (delayed)
Stock markets in the Asia-Pacific region closed mixed today
- Japan’s Nikkei 225 rose 1.10%. Last week the index fell -0.32%
- China’s Shanghai Composite Index rose 0.26%. Last week, the index changed little
- Hong Kong’s Hang Seng fell -1.39%. Last week the index fell -0.11%
- Australia’s S&P/ASX 200 index fell -0.67%. Last week the index increased by 0.70%
In the US debt market, yields are higher
- 2-year yield, 5.058%, up 2.5 basis points
- 5-year yield, 4.479%, up 2.6 basis points
- 10-year yield, 4.340%, up 1.8 basis points
- Yield at 30 years, 4.420%, up 0.9 basis points
In the European debt market, 10-year benchmark yields are rising. The German 10-year is approaching the high yield of the year at 2.77%. The current yield is trading at 2.692%. French 10-year yields are also close to their high yield of 3.285%.