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EUR 9.38
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http://track.com/articles/the-morning-track-trending/
Social media and markets are married by the “trending†focus of themes. The biggest today not being the economic data – even though its mostly higher inflation, paltry growth and better confidence. Rather the key worry remains political with hard Brexit and the US elections dominating. The GBP is the dog of the day with a Northern Irish high court upholding the PM May government Brexit is Brexit push. This unwound anything about GBP or CPI or BOE responding to them next week. Notable also that even SEK reversed a bit today despite the intention of the Riksbank to do what it needs to get inflation just like the UK or the US. The biggest stand out overnight maybe in the better Swiss KoF indicator bouncing to January 2014 highs and comparing that against the weaker than hoped French GDP. The political risks in Europe are likely to be central after November 8th and markets seem to want to trade those fears accordingly. But overall, the real trending story has been an
d remains bonds – with the US 10Y trading over 1.87% briefly today only to find some respite from ECB comments that they need to keep doing more – rather than talk about tapering and bask in the nascent glow of German inflation. This sets the tone for US GDP and whether the USD is going up because of rates or because of growth with the distinction being key, nominal GDP or real GDP matters. The fear of fast inflation driving up commodities and lifting some EM along with commodity-linked FX plays isn’t flashing much other than red today. Just look at the TRY chart to get a perspective that higher rates globally are welcome.
That means the US GDP components matter significantly with the PCE central to the FOMC debate. The focus maybe wisely put on the AUD accordingly as the risk barometer for the day is in commodities, carry and EM FX. AUD seems out of place with RBA expected on hold even with an uneven economy –as we all watch .7475 support at the 200-day moving average.
The Morning Track trending
- The Morning Track – Trending by Bob Savagehttp://track.com/articles/the-morning-track-trending/
Social media and markets are married by the “trending†focus of themes. The biggest today not being the economic data – even though its mostly higher inflation, paltry growth and better confidence. Rather the key worry remains political with hard Brexit and the US elections dominating. The GBP is the dog of the day with a Northern Irish high court upholding the PM May government Brexit is Brexit push. This unwound anything about GBP or CPI or BOE responding to them next week. Notable also that even SEK reversed a bit today despite the intention of the Riksbank to do what it needs to get inflation just like the UK or the US. The biggest stand out overnight maybe in the better Swiss KoF indicator bouncing to January 2014 highs and comparing that against the weaker than hoped French GDP. The political risks in Europe are likely to be central after November 8th and markets seem to want to trade those fears accordingly. But overall, the real trending story has been an
d remains bonds – with the US 10Y trading over 1.87% briefly today only to find some respite from ECB comments that they need to keep doing more – rather than talk about tapering and bask in the nascent glow of German inflation. This sets the tone for US GDP and whether the USD is going up because of rates or because of growth with the distinction being key, nominal GDP or real GDP matters. The fear of fast inflation driving up commodities and lifting some EM along with commodity-linked FX plays isn’t flashing much other than red today. Just look at the TRY chart to get a perspective that higher rates globally are welcome.
That means the US GDP components matter significantly with the PCE central to the FOMC debate. The focus maybe wisely put on the AUD accordingly as the risk barometer for the day is in commodities, carry and EM FX. AUD seems out of place with RBA expected on hold even with an uneven economy –as we all watch .7475 support at the 200-day moving average.
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Robert Savage
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