The USD is mostly lower
The AUD is the strongest and the NZD is the weakest as NA traders enter for the day. That has the AUDNZD as the strongest currency pair. The catalyst? The RBNZ nearly doubled the QE and kept the door open for negative rates. The decision sent the NZDUSD lower and although it has moved higher on the rebound in stocks, the AUDUSD has outpaced its run higher. The USD is mostly lower ahead of Fed’s Powell who speaks at 9:00 AM ET/1300 GMT. The Fed has thrown all its might at the market. Yesterday the Fed started the purchase of corporate bond ETFs which is as close to buying stocks without buying stocks. Fed speak has been NOT in favor of negative interest rates this week. US yields are marginally lower. Stocks are higher prompting some risk on flows (and moves out of the safety of the USD). The Fed
Looking at the ranges and changes, the USD is at extreme levels (lower dollar) vs all the major currencies with the exception of the NZDUSD (the NZDUSD is trading mid range after the sharp fall on the RBNZ decision. The ranges though for the major pairs are modest. The EURUSD, USDJPY, USDCHF all have ranges below 44 pips. The NZDUSD has a near 100 pip range but is only down -28 pips at the morning snapshot.
- Spot gold is trading up $5.22 or 0.31% at $1708. That is near session highs at $1709.23. The low price today reached $1699.31. The low dollars helping to support the precious metal
- WTI crude oil futures are trading near unchanged levels at $26.30 for the July contract. That is down $0.03 on the day. The high price reached $26.59 the low price extended to $25.53. The current price is trading at $26.30
In the premarket for US stocks, lower prices implied by futures overnight have been recouped with the major indices now trading higher. The current snapshot shows
- Dow +42 points.
- S&P index +6.5 points
- NASDAQ composite index up 49 points
Although stocks are higher, the levels are coming off European morning highs.
In the European equity markets, the European indices are still trading lower on the day although off there lowest levels. They are playing catch-up from yesterday’s end of day selling in the US.
- German DAX, -1.3%
- France’s CAC, -1.5%
- UK’s FTSE, -0.7%
- Spain’s Ibex, -0.7%
- Italy’s FTSE MIB -0.85%
in the US debt market, yields are marginally lower. The Fed will complete their monthly refunding with the auction of 30 year bonds at 1 PM ET. The 3 and 10 year notes were distributed without a hitch. The 30 year yield is currently trading down -1.7 basis points before the auction.
In the European debt market, the benchmark 10 year yields are trading lower across the board.