From Marc Chandler at Bannockburn Global Forex:
Overview: The US dollar is a little softer today but mostly consolidating yesterday's moves against the G10 currencies. The Australian dollar leads the way and reached its best level since September 18. The market, though, has shrugged off surprising data: a surge in German factory orders and a disappointing drop in household spending in Japan. Most emerging market currencies are firmer. As widely expected, the Reserve Bank of India cut its repo rate by 25 bp to 5.25% and signaled there was room for more cuts. The PBOC lifted the dollar's reference rate slightly, but it has fallen on a weekly basis since the end of September, with one exception.
Outside of Japan, where the major indices fell by 1%, the large equity markets are higher today. In the Asia Pacific region, Shenzhen and the index of mainland shares that trade in Hong Kong led the regional move with 1.25%-1.80% gains. Europe's Stoxx 600 is up about 0.25%. If the gains are sustained, it would be the ninth advance in 10 sessions. S&P and Nasdaq futures are up 0.2%-0.4%. The European bond market is quiet with most yields slightly firmer. On the week, the 10-year Gilt yield is off about 4 bp, while German's yield is up almost three. The US 10-year Treasury yield is firm at 4.10%, about two basis points higher than a week ago. Gold continues this weeklong consolidation. In the spot market is settled at $4240 last week and is near $4223 now. January WTI is near the upper end of the $58-$60 range that has confined priced this week.USD: The Dollar Index made a marginal new low since late October yesterday, a little below 98.80, the 38.2% retracement of the rally since September 17 (Fed Day). The next retracement (50%) is around 98.30. However, the downside momentum has eased and DXY rose yesterday for the first time in nine sessions. It is trading inside yesterday's range so far today. The market is confident that the Federal Reserve will cut rates next week and knows that the dollar rallied after the September and October Fed cuts. Short-term participants appear to be turning cautious. Today' September personal income, spending, and deflators are too dated to be important for policymakers or investors. The median in Bloomberg's survey sees the headline deflator edging up to 2.8% from 2.7% in August. If accurate, it will be a new high for the year and match the highest level since last year's high of 2.9% in April. It was at 2.6% last November. The core rate may moderate slightly (2.8% vs. 2.9%) for the first time in five months. The futures market is discounting about a 60% chance of a cut in Q1 26....
....MUCH MORE
The man packs a lot of information into those chnky paragraphs.
