From Marc Chandler at Bannockburn Global Forex:
Overview: The dollar is sporting a softer profile today against all the G10 currencies but the Swedish krona. The Riksbank sounded more dovish than previously, signaling the possibility of a cut in each of the last three meetings of the year. The dollar has sustained its push above JPY160 against the Japanese yen. Most emerging market currencies are also firmer, with the notable exception of Türkiye and South Africa. Türkiye is expected to keep its one-week repo rate steady today at 50%, while the Czech central bank is seen delivering a quarter-point cut. (to 5.0%). The central bank of Mexico meets later today and will hold the interest rate target at 11.00%.
Equities are under pressure today. All the large bourses fell in the Asia Pacific region but India. The losses were led by a 2% slide in the Hang Seng and a nearly 2.4% drop in the index of mainland shares that trade there. Europe's Stoxx 600 is off for a third consecutive session, which if sustained, matches the longest losing streak of the year. US index futures are trading lower. Bond markets are also under pressure. The 10-year JGB has risen for six straight sessions, and a little above 1.07% it is approaching the year's high set at the end of May near 1.10%. European benchmark yields are more 2-3 bp higher. The US 10-year Treasury yield is firm a little above 4.33%, after increasing by eight basis points yesterday, the most in nearly three weeks. Gold found support below $2300 and is trading firmer after falling in three of past four sessions. August WTI has been chopping between $80 and $82 for the past five sessions and looks poised to push higher. It has not been above $82 since late April.
Asia Pacific
The two key developments are the dollar holding above JPY160 and the continued decline in China's 10-year yield to fresh 20-year low near 2.20%. Chinese officials appear increasingly concerned about the decline in rates, and reports suggest the PBOC has threatened to sell some of its bond holdings....
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