From Marc to Market:
Overview: The dollar is trading quietly in mostly narrow ranges against the most of the G10 currencies. The key development has been the escalation of pressure on Russia from a new round of sanctions by the US and EU. The US sanctioning of two of Russia's largest oil companies will disrupt Chinese and Indian buyers who may fear being sanctioned themselves if they continue buying Russian oil after a few weeks grace period. December WTI was at a five-month low near $56 a barrel on Monday has surged to about $61.60 today. The month's high was set around $62.50, which is also now near the 100-day moving average. In the foreign exchange market, the jump in oil prices may be a factor leading to the yen's under-performance today and the Norwegian krone's outperformance. Most emerging market currencies are weaker, though the PBOC set the dollar's reference rate at a new low since October 2024.
The rise in oil prices has taken the wind from the global bond market. Benchmark 10-year yields are up 1-2 bp in Europe and the 10-year Treasury yield is up nearly four basis points to 3.99%. If sustained it would be the largest rise in the US yield this month. Meanwhile, the US is reportedly considering broad software curbs on China, and this may have weighed on Japanese, South Korea, and Taiwanese equities today. Other bourses in the region advanced. Europe's Stoxx 600 is firm, recouping yesterday's nearly 0.2% decline. US index futures are little changed. After a few days of volatile moves, gold is trading quieter in its narrowest range in slightly more than a week (~$4066-$4137).
USD: The Dollar Index has a four-day advance in tow, matching its longest rally in nearly three months....
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