Raising the roof
Today's news headlines:
'Gold prices zoom higher on expectations for slower Fed rate rises'. The Dollar's recent slump and lower interest rate expectations among market participants are causing Gold to rally towards all-time highs once again. This is just one data point that characterises the tension between central bank messaging that policy will keep tightening and market expectations to the contrary. The operative dynamic to bear in mind is that lower rates contribute to Dollar depreciation which makes Gold cheaper for non-US buyers. (Financial Times)
'The debt ceiling is scarier this time'. It's that time once again, your favourite reality TV show and ours, it's debt-ceiling-stand-off in the US House of Congress! Witnessing the recent embarrassing House Speaker election, one can only assume the show will be extra dramatic this time around. On a serious note, even a briefly missed interest payment on government debt could cost taxpayers tens of billions of Dollars, but that doesn't mean it can't happen. (Financial Times)
The US Dollar Index is holding steady overnight, and there's a very quiet data calendar today. This week's big feature will be US Inflation data tomorrow, which will weigh into the market/Fed tension over US Monetary policy.
NZ ANZ Commodity Prices m/m: -0.1% vs -4.0% last month
AU CPY y/y: 7.3% vs 6.9% last month
AU Retail Sales m/m: 1.4% vs 0.4% last month
EU Italian Retail Sales m/m: 9:00 AM
GBP/USD – 1.2150
GBP/EUR – 1.1640
EUR/USD – 1.0740
USD/CAD – 1.3430
Please contact your Dealer about any upcoming FX requirements you may have, or call +44 (0)20 3465 8200.
*Indicative interbank rates taken on the day of writing. Please speak to your Dealer to find out the current rates available for you.