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FOREX: Rates Volatility Prompts Dollar to Reverse Small Part of Recent Gains

FOREX
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  • The greenback sits softer against all others, as markets erase a small part of the recent sharp dollar rally. The moves coincide with an uptick in near-term vols across DM rates markets, with US 10y yields fading off the week's best levels, taking the greenback with it.
  • Initial interest in UK rates markets came alongside hawkish pressure on BoE rates pricing after an article in the Guardian suggested the government could opt for a different definition of public sector net debt, leaving considerable funds for infrastructure investment - but a soft set of UK PMI numbers soon reversed the move, which had already been biased lower after Bailey's dovish undertones in a late appearance yesterday.  
  • A lower close for GBPJPY today would be the first in four sessions, with markets having now opened a ~160 pip gap with the weekly high at 198.44. The 15min candle chart exposes 196.63 as a decent support today - having held on the earlier pullback.
  • Weekly jobless claims data crosses later today, and given the split pricing between 25 and 50bps of Fed rate cuts into year-end, the market may remain sensitive across the release. Prelim PMI numbers for October are also due, with new home sales stats set to cross after the cash equity open. Central bank speak set for today includes BoE's Mann & Bailey and ECB's Kazaks & Lane.
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  • The greenback sits softer against all others, as markets erase a small part of the recent sharp dollar rally. The moves coincide with an uptick in near-term vols across DM rates markets, with US 10y yields fading off the week's best levels, taking the greenback with it.
  • Initial interest in UK rates markets came alongside hawkish pressure on BoE rates pricing after an article in the Guardian suggested the government could opt for a different definition of public sector net debt, leaving considerable funds for infrastructure investment - but a soft set of UK PMI numbers soon reversed the move, which had already been biased lower after Bailey's dovish undertones in a late appearance yesterday.  
  • A lower close for GBPJPY today would be the first in four sessions, with markets having now opened a ~160 pip gap with the weekly high at 198.44. The 15min candle chart exposes 196.63 as a decent support today - having held on the earlier pullback.
  • Weekly jobless claims data crosses later today, and given the split pricing between 25 and 50bps of Fed rate cuts into year-end, the market may remain sensitive across the release. Prelim PMI numbers for October are also due, with new home sales stats set to cross after the cash equity open. Central bank speak set for today includes BoE's Mann & Bailey and ECB's Kazaks & Lane.