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....
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Gold, Oil, And Interest Rates Rise