The G10 basket of currencies traded in narrow ranges overnight leaving most pairs little changed vs. yesterday’s close. The biggest spot move is a 0.26% gain for the dollar vs. the JPY, followed closely by a 0.21% dollar gain vs. NZD. All other G10 spot returns range between 0.03% and 0.15% respectively with a slight edge towards dollar gains.
The dollar also dominated in the majors basket led by a 0.78% advance against the MXN, partially reversing the dollar’s 4.76% 4-day slide. Near-term support is now at 19.1000 and resistance at 20.1000.
U.S. treasury yields are also mixed in narrow ranges, with gains in the near tenors (1mo to 10yr) and declines in the 15yr-30-yr.
The currency/rates markets are quiet in the lead up to tomorrow’s FOMC rate announcement. Today is the first of the Fed’s two-day meeting which ends with tomorrow’s rate decision. Fed Funds Futures imply a minimum 25bps cut and significant potential for a 50bps cut.
Advance Monthly Retails Sales for August (advance means the data is subject to adjustments over the next few weeks) were +0.1%, above the -0.2% estimate. And July was revised higher, going from 1.0% to 1.1%.
Most global equity indexes are higher today, lifted by optimism of lower borrowing costs for businesses. The S&P 500 Index gapped 0.40% higher at today’s open compared to yesterday’s close.
The spot price of gold is holding onto recent gains and is +25.01% YTD. Silver is +0.73% today at $30.93/.oz and is +30.14% YTD. Oil is +1.0% today at $70.89/barrel, increasing the distance from its Sept 10th low at $65.27/barrel.
