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Greenback Inches Higher, While Curve Flattens Further

CROSS ASSET
  • Greenback strength continuing apace, printing fresh session highs against GBP, NZD and AUD as the USD Index extends the streak of higher highs and higher lows to five consecutive sessions. The yield curve trades flatter following the London close, with particular weakness noted in the 2y30y spread, which contracts below 135 points for the first time since early October last year.
  • Focus turns to the Fed minutes' release in just over an hour's time, with markets looking to gauge any comments surrounding a potential acceleration of the Fed taper laid out at the last meeting - which assumes a taper will conclude by end-July next year.
Assumed Fed taper pace:

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