Headlines:
- Fed to slow down the pace but forecast higher rates for next year?
- China reportedly may announce more supplementary Covid measures this week
- Shanghai to remove Covid testing requirement to enter more public places from tomorrow
- ECB's Makhlouf says anticipates that 50 bps rate hike is "where we will end up"
- ECB's Makhlouf: 50 bps rate hike is the minimum for December
- ECB's Villeroy: Too soon to talk about terminal rate
- Eurozone October retail sales -1.8% vs -1.7% m/m expected
- Eurozone November final services PMI 48.5 vs 48.6 prelim
- UK November final services PMI 48.8 vs 48.8 prelim
- SNB total sight deposits w.e. 2 December CHF 549.8 bn vs CHF 555.4 bn prior
Markets:
- CAD leads, JPY lags on the day
- European equities slightly lower; S&P 500 futures down 0.5%
- US 10-year yields up 4 bps to 3.528%
- Gold down 0.1% to $1,795.73
- WTI crude up 2.4% to $81.92
- Bitcoin up 1.4% to $17,250
It was a rather tentative session, as traders were not given much to work with as all the focus and attention now slowly turns towards the US CPI data and FOMC meeting next week.
There were some mixed tones earlier with equities and bonds keeping more subdued, but the dollar was softer across the board. But a pick up in USD/JPY from 134.30 to 135.50 saw the dollar also turn things around across other major currencies to keep more mixed on the day. Right now, the dollar is just mildly softer on the balance of things.
EUR/USD moved down from 1.0560 to 1.0520 before keeping closer to 1.0570 now, with large option expiries seen nearby. GBP/USD nudged lower from 1.2320 to 1.2235 before coming back up again to 1.2300 currently.
The loonie is the lead gainer, with USD/CAD nudging lower from 1.3440 to near 1.3400 now as higher oil prices are helping to underpin the Canadian dollar as well. WTI crude is up to near $82 as optimism from China's re-opening continues to impose itself on broader markets.
Meanwhile, AUD/USD is up 0.3% to just above 0.6800 but off earlier highs in the day around 0.6850 in Asia.
Overall, there are some tentative tones and mixed flows in markets - not helped by the fact that we have entered the Fed blackout period now and with a lack of key economic data releases in the meantime.
