The dollar index rose against major currencies. The index is expected to rise for the fourth week in a row as expectations for the rate and pace of Federal Reserve interest rate cuts ease following a series of positive data releases this week. . Market participants are now focused on the US October earnings report which will be released next week.
“The expectations for the US economy have been significantly rebalanced, and that process appears to be almost complete,” said Karl Schamotta, chief market strategist at Kopay.
In late trade, the dollar index rose 0.18% to 104.24. It rose 0.74% for the week.
The euro/dollar exchange rate fell 0.22% to $1.0803.
The growing possibility that former President Donald Trump, the Republican candidate, will return to power in the US presidential election in November is also a boon for the dollar. Mr. Trump is likely to implement policies that will lead to higher inflation, such as tax increases.
According to FedWatch from CME, the market has priced in a 95.6% probability that the US Federal Open Market Committee (FOMC) will cut interest rates by 0.25 percentage points in November, and a 4.4% probability that the rates will not change. A month ago, the bank had fully considered the possibility of a rate cut of at least 0.25 percentage point, and the probability of a 0.5 percentage point cut was 57.4%.
The dollar/Yen exchange rate rose 0.26% to 152.21 Yen.
GBP/USD fell 0.02% to $1.2969.
NY Foreign Exchange Market:
Government bond yields rose slightly. Investors are taking a cautious stance ahead of the US presidential election and employment data that could provide new clues about the direction of the Federal Reserve’s interest rate cuts.
The yield on the 10-year Treasury note hit a three-month high on Wednesday, as traders expected the Fed’s stance to weaken after a much better-than-expected September jobs report.
The next big focus will be on employment statistics in October, which will be published on 1 November. Employment is expected to rise by 123,000 people, according to a Reuters poll.
Stephen Golla, head of US Treasury sales and trading at StoneX Group, said the market is eyeing another strong jobs report. He also said that October is typically a bearish month for bonds.
Padraic Garvey, head of regional research for the Americas at ING, said the strong economic data meant there was “no good reason for the 10-year Treasury yield to fall significantly.”
Traders are pricing in a 75% chance the US Federal Open Market Committee will cut interest rates by 25 basis points in November and December, according to CME Group FedWatch.
The benchmark 10-year bond yield rose 2.4 basis points to 4.226%. On the 23rd, it stood at 4.26%, the highest since July 26th.
The two-year bond yield rose 2.8 basis points to 4.094%.
The yield gap between 2-year bonds and 10-year bonds remained almost unchanged at 13 basis points.
Markets predict that former US President Donald Trump will win the US presidential election on November 5, increasing the likelihood that the Republican Party will have a majority in both houses of Congress.
Mi Financial Bond Market ・:
The Nasdaq Composite continued to rise and closed. Large cap stocks led the rise.
“Tesla’s numbers revive hope that the rise of the Magnificent Seven is not over yet,” said Brian Jacobsen, chief economist at Annex Wealth Management.
LSEG data shows that investors are still betting on an additional 25 basis point (bp) rate cut at the Federal Open Market Committee (FOMC) meeting in November and about two more rate cuts this year.
Most of the 11 S&P sectors fell. Resources were the main reason for the decline.
Declining issues outnumbered advancing issues on the New York Stock Exchange by a 1.56-to-1 ratio.
The total trading volume on US exchanges was 11.54 billion shares. The smallest stock dividend was 11.28 billion for the last 20 business days.
US stock market:
Gold futures continued to rise, supported by demand for gold as a safe-haven asset. The settlement price (equal to the closing price) in the main December contract was $2,754.60 per ounce, an increase of $5.70 (0.21%) from the previous day, and an increase of 0.90% for the week.
NY Precious Metals:
Prices rebounded for the first time in three days on buying concerns over the situation in the Middle East, where there is still a sense of uncertainty, and the US presidential election, which is expected to count early next month. The settlement price (equal to the closing price) of the main US WTI oil contract for December was $71.78 per barrel, an increase of $1.59 (2.27%) from the previous day. The January contract was $71.35, up $1.51 from the previous day.
NYMEX Energy:
This is a provisional value based on LSEG data. Maybe the comparison from the previous day doesn’t fit.
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2024-10-25 21:54:00
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