Global equity markets were buoyant following news that Russian President Vladimir Putin sees a positive shift in negotiations with Ukraine. European stock markets are up between 1% and 3% and the S&P 500 opened up nearly 1%. The US dollar is mixed and US Treasury 10YR yields are up 2 bps to 2.01%. Oil and gold prices are both lower. Talk of economic stagflation – high inflation/slow economic growth - flourishes in the market place.
“It is during our darkest moments that we must focus to see the light.”
March 11, 2022
EUR/USD 1.0983 GBP/USD 1.3083 USD/CAD 1.2702 AUD/USD 0.7323 USD/JPY 116.87 USD/CNH 6.3390 USD/ILS 3.2508 USD/MXN 20.9146 USD/CHF 0.9321 USD/INR 76.5925 USD/BRL 5.0267 USD/SGD 1.3602 USD/DKK 6.7748 USD/SEK 9.6956 USD/NOK 8.9327
The dollar is mixed in the FX market, gaining the most value against the JPY and AUD, losing the most value against the NOK, MXN and CAD. Stocks are opening higher following Putin’s upbeat comments on negotiations with Ukraine.GBPThe UK pound is higher on the back of upbeat economic statistics. UK GDP for January rose 0.8% MoM, its fastest growth in seven months, and much higher than 0.1% expected and December’s -0.2%. Industrial Production and Construction Output also exceeded expectations and previous figures. Traders look forward to next week’s Bank of England meeting – a 75 bps hike is expected, as the BoE is focused on rising inflation and the tight labor market. The BoE's 15 bps hike in December made it the first major central bank to hike rates and in February it hiked 25 bps to 0.50%.EUR
The euro traded overnight in a fairly wide $1.0955-1.1045 range, and currently trades around $1.10, representing a small gain over yesterday’s close. There were no economic releases today. Markets are still digesting the hawkish move by the ECB yesterday when they said they will accelerate the reduction of its bond buying program.CAD
This morning’s release of upbeat employment data in Canada for February helped boost demand for the Canadian dollar. Net Change in Employment of 336.6K exceeded 127.5K expected and January’s decline of 200K. Canada’s unemployment rate fell from 6.5% to 5.5%. Canadian government bond 2Yr yields rose 8 bps to 1.62%, its highest level since January 2020.ASIA/PACIFIC
The Japanese yen fell against the US dollar – USD/JPY rose briefly above 117, its highest level since January 2017. The yen’s weakness was a result of lower demand for safe-havens following Putin’s upbeat comments and higher US bond yields, always a key driver of the USD/JPY currency pair. There were no economic releases in Japan today.
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