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Equities, Yields & (Maybe) Trump Factor Into USD Outperformance


Desks flag Asia-Pac interbank FX activity that was 70-75% above (admittedly subdued) recent averages.

  • The USD was bid on the back of relatively broad-based weakness in Asia-Pac equities (although China’s CSI 300 finished a touch higher on the day), as the region adjusted to higher core global yields and a negative lead out of Europe.
  • Option-related flow surrounding the Hang Seng also generated some interest and may have created further downside pressure.
  • The BBDXY tested YtD highs.
  • Tsy yields are higher, partly on catch up to Fed/ECB-speak over the long weekend.
  • Potential feedthrough from a comfortable victory for Donald Trump at the Iowa caucuses was also noted when it came to Tsys/USD.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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