Upside surprises in the final US GDP numbers and jobless claims make it difficult for markets to agree on upcoming Fed cuts. A benign PCE reading on Friday won't change that, but payrolls data next week should be more pivotal. Euro rate markets are keen to follow the bearish mood as a stronger dollar reduces disinflationary
Chinese equities hit a fresh three-year high, while India's Nifty 50 rebounded on Monday after President Xi Jinping and Prime Minister Narendra Modi attended a weekend summit in Shanghai alongside leaders from Russia, Iran and Turkey. The meeting focused on strengthening ties among emerging markets in the face of what participants described as aggressive US trade policies.
The US dollar is little changed at the start of this week as it continues to trade at weaker levels following last week’s sharp sell-off. The dollar index has fallen back below the 104.00-level giving back all of its gains since the US election victory for President Trump.
Given the current macro and geopolitical backdrop globally, the ECB yesterday were unwilling to provide much in the way of strong guidance but the description of the monetary stance being “more meaningfully less restrictive” helped to provide further modest support for yields with EUR/USD extending the significant gains already recorded this week.
