Marketwatch North America

Daily Insights
January 18, 2024

U.S. Weekly Jobless Claims for the week ending 13Jan24 were 187k, below the 205k estimate, and the lowest claims since 23Sep22 (16 months). Today’s strong jobs data, combined with yesterday’s higher-than-expected December Retail Sales, and last week’s higher-than-forecast CPI (consumer inflation), taken together depict an expanding U.S. economy undeterred by high borrowing costs.

The recent string of positive economic data has caused traders to push back their timelines for expected Fed rate cuts, lifting the U.S. dollar and treasury yields in the process.

The dollar index is higher for the 3rd consecutive day, +0.10% at 103.55, and confirming the breakout from its weekly downtrend. Today’s dollar gains vs. the G10: +0.47% vs. CHF, +0.29% vs. NOK, +0.24% vs. NZD, +0.21% vs. EUR, & +0.11% vs. GBP.

U.S. Treasury yields are higher in the long-dated tenors today, and the 10-year yield is +14 basis-points since last week’s CPI data. Fed Funds Futures are now pricing in only a 56% probability of a rate cut at the FOMC’s March meeting, down from a 78% probability as recently as Jan 12th. Probabilities of cuts at the May, June, July, and September meetings have seen similar declines.

Equities are lower in lock step with the higher trend in yields, the continuation of high borrowing rates prolonging the headwind for businesses and driving down revenues.

Tomorrow’s economic calendar includes Consumer Sentiment and Existing Home Sales.

Economic Calendar

:
USD - FOMC Member Bostic Speaks
:
USD - Unemployment Claims
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GBP - RICS House Price Balance
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AUD - MI Inflation Expectations
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USD - Building Permits
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USD - Philly Fed Manufacturing Index
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AUD - Employment Change
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AUD - Unemployment Rate
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USD - Housing Starts
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JPY - Revised Industrial Production m/m
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EUR - ECB President Lagarde Speaks
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EUR - Current Account
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USD - Crude Oil Inventories
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All - WEF Annual Meetings
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GBP - BOE Credit Conditions Survey
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CHF - SNB Chairman Jordan Speaks
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EUR - ECB Monetary Policy Meeting Accounts
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AUD - CB Leading Index m/m
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USD - Natural Gas Storage
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NZD - BusinessNZ Manufacturing Index
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NZD - Visitor Arrivals m/m
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JPY - National Core CPI y/y

Market Indicators

Currency Pairs
Pair High Low
usd/jpy 148.299 147.653
eur/usd 1.09068 1.08505
gbp/usd 1.27039 1.2648
aud/usd 0.65746 0.65248
usd/cad 1.35258 1.34804
eur/gbp 0.85915 0.85685
usd/mxn 17.2348 17.1509
Equities and Commodities
S&P 500 4762.05
NASDAQ 16894.4
DOW 37241.6
GOLD 2010.18
SILVER 22.44

This document is for information purposes only and does not constitute any recommendation or solicitation to any person to enter into any transaction or adopt any trading strategy, nor does it constitute any prediction of likely future movements in exchange rates or prices or any representation that any such future movements will not exceed those shown on any illustration. All exchange rates and figures appearing are for illustrative purposes only. You are advised to make your own independent judgment with respect to any matter contained herein.