Wednesday, December 13, 2017

"Greenback Quiet Ahead of Five Central Bank Meetings"

From Marc to Market:
The Federal Reserve gets the balling rolling today with the FOMC meeting, which is most likely to deliver the third hike of the year. Tomorrow, four European central banks meet: Norway, Switzerland, the UK, and the ECB.

The MSCI Asia Pacific Index rose nearly 0.3%, though Japanese and Indian shares were lower. In Europe, the Down Jones Stoxx 600 is paring yesterday's gains (-0.2%) led by utilities and telecom. Consumer discretion and financials are firmer. The MSCI Emerging Markets Index is up 0.3% taking back half of yesterday's loss.

US 10-year yields are pushing higher after finishing at 2.40% yesterday. European bonds yields are firmer, with Italy and France bearing the brunt. Oil prices are rebounding after yesterday's drop comes on the heels of the US industry report that showed another large drop in US inventory, part of which is being shifted toward gasoline and heating oil. In emerging markets, the Russian ruble and South African rand are doing best (0.3% and 0.2% respectively.)

As North American operators return to their desks, the greenback is little changed. It did slip to the low for the week against the yen, when it became clear that the Republicans were going to lose the Senate seat in Alabama. This reduced the Republican majority to one in the Senate. Owing the fissures in the party, this is putting at risk other parts of Trump's agenda, which Treasury Secretary Mnuchin acknowledged earlier this week is necessary to achieve the kind of growth levels that the tax bill assumes....MORE