AFMC - Gold Oil And Interest Rates Rise
2024-04-02 07:12:00 ET
Summary
- The Dollar Index made a new high for the year, a little above 105, which had been anticipated by the new lows recorded by the Bannockburn World Currency Index last week.
- Most emerging market currencies are softer, but the Turkish lira is extending yesterday's recovery and the South African rand, and the Mexican peso are firmer.
- With the Bank of Japan exiting its negative interest rate policy last month, speculation has turned to the next move.
- US index futures are trading a little softer.
Overview
The market put more weight on the rise in the US ISM manufacturing survey than the downward revision to the manufacturing PMI and the unexpected back-to-back decline in construction spending. US rates shot up and lifted the greenback. The Dollar Index ([[DXY]], [[USDOLLAR]]) made a new high for the year, a little above 105, which had been anticipated by the new lows recorded by the Bannockburn World Currency Index (a GDP-weighted basket of the currencies of the 12 largest economies) last week. The two-year Treasury yield surged almost 9 basis points to settle above 4.7%, its highest in two weeks. It is slightly lower now. 10-year yield ( US10Y ) jumped 11 basis points, the most since January CPI was reported on February 13. It is slightly firmer today to approach the Q1 24 high (on March 18) near 4.35%. The dollar bloc and Scandis have been joined by sterling, posting minor gains against the dollar. With a soft manufacturing PMI and soft CPI due Thursday, the Swiss franc has been sold the hardest and is off around 0.5%. Most emerging market currencies are softer, but the Turkish lira is extending yesterday's recovery and the South African rand, and the Mexican peso are firmer....
Gold, Oil, And Interest Rates Rise