- S&P Global prelim US services PMI for February 51.3 vs 52.0 expected
- US weekly initial jobless claims 201K versus 218K expected
- US existing home sales for January 4.00M vs 3.97M expected
- Canada December retail sales +0.9% vs +0.8% expected
- Fed's Jefferson says CPI shows path down for inflation likely to be bumpy
- Jefferson Q&A: Over time household balnce sheets will normalize and drive less consumption
- Fed's Harker: We may be near the point of cutting rates but unsure of when it will happen
- US weekly oil inventories +3514K vs +3879K expected
Markets:
- Gold flat at $2024
- US 10-year yields flat at 4.32%
- WTI crude oil up 54-cents to $78.45
- NZD leads, JPY lags
- S&P 500 up 2%, Nasdaq up 3%
The US stock market gain was a sight to behold as a massive gain in Nvidia shares led to a broad rally. Equally impressive -- or perhaps worrisome -- is how no other markets were so quiet. The FX sold dollars in Europe only to buy them back in US trading with the help of a better jobless claims report (though ignoring a softer services PMI).
The Fed commentary highlighted disappointment on CPI but no change in plans to cut rates later this year, depending on economic data.
AUD/USD made a 50 pip round trip to finish nearly flat on the day while the Canadian dollar made some headway on a better oil inventories report and modest beat in December retail sales. The pair fell to 1.3440 before slowly recovering to 1.3500.
Cable was especially volatile as it climbed 60 pips to 1.2709 before falling to 1.2614 and then regrouping in a climb to 1.2659.
It's tough to pin down what was behind the dollar moves. US 2-year yields rose 6 bps to 4.71% as Fed hikes were pared down to 82 bps this year but that ran into positive risk appetite. Germany was hit by another wave of poor economic data but the euro didn't initially care.
