The New Week Starts With Little Appetite, Metals And Energy Are Under Pressure
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The week starts on a cautious note, as the Federal Reserve (Fed) rate hike expectations intensify the selloff in global stocks and bonds, while pushing the US dollar higher against most majors.
PCE data
Friday’s PCE data showed that not only inflation didn’t slow in January, but headline figure ticked higher to 5.4% from 5.3% printed a month earlier, and core inflation ticked higher to 4.7% from 4.6% printed a month earlier. The latter fueled the Fed hike expectations, because a slower-than-expected easing in inflation is one thing, but rebound in inflation is another thing.
US Yields
As a result, the US yields keep pushing higher, and equities lower.
In the FX, it becomes increasingly clear that we will see a pause in the USD downside correction.
EUR/USD
The EURUSD could further fall to and below 1.05, and renewed euro softness could weigh on European equities.
Commodities
In commodities, rising US yields and the stronger US dollar hint at further decline in gold prices, as well, while crude oil continues struggling.
Europe
In Europe, Britain’s Rishi Sunak and EU’s Ursula von der Leyen will meet today to finalize the Northern Ireland drama.
Watch the full episode to find out more!
- 0:00 Intro
- 0:21 Rebound in US inflation sends stocks, bonds tumbling
- 3:48 USD appreciation is also bad for European stocks
- 6:35 Metals, energy under pressure
- 8:11 Light at the end of Northern Ireland tunnel?
- 9:12 Tesla’s investor day coming!
Ipek Ozkardeskaya
Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020.
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