Markets consolidated, following the previous day’s surge in risk appetite. The S&P500 is currently down 0.2%, with bond yields and currencies little changed. While yesterday’s vaccine news was promising, the ensuing commentary has highlighted manufacturing and distribution challenges. US 2yr treasury yields ranged between 0.17% and 0.18%, while the 10yr yield rose from 0.91% to 0.97%, back to yesterday’s high. Australian 3yr government bond yields (futures) rose from 0.17% to 0.19%, while the 10yr yield rose from 0.92% to 0.97% - a two-month high. Commodities, Brent crude oil futures rose 2.2% to $43.35, copper fell 0.1%, iron ore rose 0.8% to $122.55, and gold rose 0.8%.
AUD/USD: 0.7253 – 0.7294
EUR/USD: 1.1780 – 1.1843
GBP/USD: 1.3169 – 1.3278
USD/JPY: 104.96 – 105.48
USD/CAD: 1.2985 – 1.3051
NZD/USD: 0.6804 – 0.6840
AUD/JPY: 76.36 – 76.81
AUD/NZD: 1.0643 – 1.0675
AUD/USD traded in a tight 0.7253/.7294 range yesterday despite meaningful 2-way flows. Demand is now expected ahead of 0.7220 while offering interest likely rests above 0.7340 and again between 0.7385/.7400.
Event Risk Data Today
Australia: November Consumer Sentiment Survey.
New Zealand: The RBNZ monetary policy decision. Market expects the overnight cash rate will remain at 0.25% and the LSAP will be unchanged, but that a small Funding for Lending Programme (FLP) targeted at business lending will be announced.
US: Veteran’s Day holiday. NYSE open, bond market closed.