The USD moved higher today with the major indices vs the USD moving up with yields. The Fed minute from the early May meeting were viewed as more hawkish with the Fed saying that it will take longer than anticipated to gain greater confidence in the inflation fall. Although there were thoughts that the comments were made before the more recent data which showed inflation lower and retail sales also lower, the yields in the short end moved higher in reaction.
- The 2 year yield is trading up 4.2 basis points at 4.875%.
- The 10 year is less pronounced with a gain of 1.2 basis points to 4.425%.
In the forex, the USD moved higher in the North American session and although the GBP and NZD outpaced the USD to the upside today in the ranking of the strongest to the weakest . In the UK CPI inflation was higher and we have an election callled by PM Sunak for July 4. In NZ, the rate statement after their rate decision was considered more hawkish, the USD is trading near highs of the day near the close vs the:
- EUR,
- JPY
- CHF
- CAD
- AUD
- NZD
For the EURUSD, the price moved lower in the US afternoon and in the process moved to within a couple pips of the key 100 day MA at 1.08143 (currently). That MA will be the key barometer in the new trading day. The current price is at 1.0820
The USDJPY is stretching to new highs into the close and in doing so, moved above the high from last week at 156.7521. The high price just reached 156.835.
The USDCHF moved up to test the high of a swing area between 0.9146 to 0.9156. The price is trading at 0.9152.
Looking at the US stock market today, the major indices moved lower ahead of Nvidia’s earnings after the close.
- Dow fell -0.51%
- S&P fell -0.27%
- Nasdaq fell -0.18%
In after hour trading, Nvidia beat expectations on EPS and Revenues, announced a 150% increase in the cash dividend and announced a 10:1 stock split. Nvidia stock traded above $1000 in after hours trading – up over 5% from the closing level.
IN a surprise move, UK PM Sunak called a national election for July 4th. Although polls are not that favourable, the PM is rolling the dice that the population will nevertheless vote Tory over Labour. The Tories have been the majority for 14 years.