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The Greenback’s recent rally has been attributed to the rise in U.S. bond yields. And since bond yields retreated during today’s morning London session, the Greenback ended up running away as well.

The Aussie and the Kiwi, meanwhile, were quick to take advantage of the Greenback’s weakness. Although the risk-on vibes and commodities rally also likely helped to push the two comdolls higher.

  • Swiss trade balance: CHF 1.77B vs. CHF 3.23B expected, CHF 3.08B previous
  • German IFO current conditions: 105.7 vs. 106.5 expected, 125.9 previous
  • German IFO business climate: 102.1 vs. 102.8 expected, 103.3 previous
  • U.K. public sector net borrowing: -£0.3B vs. £1.3B expected, -£0.4B previous
  • CBI’s U.K. industrial order expectations: steady at 4 points as expected

Major Events/Reports:

Commodities bounce

After getting clobbered yesterday, commodities were able to stage a broad-based recovery today.

The recovery in commodity prices was likely due to the Greenback’s slide. And for reference, the U.S. dollar index was down by 0.06% to 90.64 for the day when the session ended. It was at 90.85 earlier.

Other than bargain buying and Greenback weakness, market analysts also say that oil was in demand because of higher oil demand from Asia, the rebalancing of the oil market because of OPEC’s oil cut deal, and speculation that the U.S. may reimpose sanctions against Iran.

Base metals were actually mixed but most were in positive territory.

  • Copper was up by 1.56% to $3.159 per pound
  • Zinc was up by 0.60% to $3,257.75 per dry metric ton

Oil benchmarks were also in the green.

  • U.S. WTI crude oil was up by 0.44% to $68.94 per barrel
  • Brent crude oil was up by 0.23% to $74.88 per barrel

Precious metals didn’t seem to mind the prevalence of risk-taking.

  • Gold was up by 0.27% to $1,327.60 per troy ounce
  • Silver was up by 0.20% to $16.620 per troy ounce

Some risk-taking in Europe

The major European equity indices had another mixed start. Although risk-taking apparently prevailed once again since most of the major European equity indices were in positive territory again by the end of the session.

And market analysts say that the higher oil prices helped to pump up demand for energy shares, which helped to offset the disappointment caused by some disappointing earnings reports.

  • The pan-European FTSEurofirst 300 was up by 0.13% to 1,504.53
  • Germany’s DAX was up by 0.32% to 12,612.20
  • The blue-chip Euro Stoxx 50 up by 0.09% to 3,517.65

The risk-on vibes also helped to push U.S. equity futures higher, which is a sign that the risk-on vibes may carry over into the upcoming U.S. session.

  • S&P 500 futures were up by 0.58% to 2,686.75
  • Nasdaq futures were up by 0.69% to 6,713.25

Global bond yields slide

Despite the risk-friendly vibes in Europe, global bond yields were in decline as the bond selloff lost steam, with European bond yields leading the downhill charge.

And according to some market analysts, European bond yields eased because of a report from Germany’s IFO’s institute which showed that business conditions continue to deteriorate in Germany, the Euro Zone’s main economic powerhouse.

  • German 10-year bond yield down by 0.63% to 0.629%
  • French 10-year bond yield down by 0.27% to 0.849%
  • U.K. 10-year bond yield down by 0.85% to 1.525%
  • U.S. 10-year bond yield down by 0.05% to 2.971%
  • Canadian 10-year bond yield down by 0.17% to 2.351%

Major Market Mover(s):


The Greenback was the worst-performing currency of the morning London session, even though there weren’t really any catalysts.

U.S. bond yields were in retreat, though, and those may have weighed down on the Greenback. After all, the prevailing narrative since last week is that the Greenback has been taking directional cues from U.S. bond yields.

USD/JPY was down by 9 pips (-0.08%) to 108.79, USD/CHF was down by 12 pips (-0.12%) to 0.9772, USD/CAD was down by 21 pips (-0.16%) to 1.2822


The Aussie and the Kiwi both managed to win out against the pound and were the top-performing currencies of the morning London session.

The two comdolls were likely well-supported because of the risk-friendly vibes in Europe, as well as the recovery in commodity prices, since there weren’t really any direct catalysts.

NZD/USD was up by 20 pips (+0.28%) to 0.7127, NZD/JPY was up by 17 pips (+0.22%) to 77.54, NZD/CHF was up by 12 pips (+0.17%) to 0.6965

AUD/USD was up by 22 pips (+0.29%) to 0.7619, AUD/JPY was up by 19 pips (+0.22%) to 82.89, AUD/CHF was up by 12 pips (+0.17%) to 0.7445

Watch Out For:

  • 1:00 pm GMT: FHFA U.S. HPI (0.6% expected, 0.8% previous)
  • 1:00 pm GMT: S&P Case-Shiller U.S. HPI (6.3% expected, 6.4% previous)
  • 2:00 pm GMT: CB’s U.S. consumer confidence (126.0 expected, 127.7 previous)
  • 2:00 pm GMT: U.S. new home sales (630K expected, 618K previous)
  • 2:00 pm GMT: Richmond Fed’s manufacturing index (16 expected, 15 previous)