Fresh US dollar highs
The euro was beaten up throughout May and now nearly half of that decline has been erased in a flash.
That's the highest since May 17.
The bond market is completely repricing the Fed.
US 2-year yields are down 11.5 bps, which will be the largest one -day fall since 2009 if it holds.
You have to consider that the market is overreacting but I don't think that's the case. The Fed has been talking the talk but they have been wrong so many times and I doubt they have enough confidence in their forecasts to ignore this.
They'll fall back on data dependence and pretend like they didn't create unnecessary market volatility by creating hike expectations.
