Forex news for North American trading on June 10, 2021
The awaited CPI data came in a little bit higher than expectations. The month-to-month showed a 0.6% gain versus 0.5% estimate The Ex food and energy rose by 0.7% versus 0.5%. YoY the headline number rose to 5.0% from 4.7% and ex food and energy increased to 3.8% versus estimate of 3.5%. That is the bad news. The potentially good news is that if the price action starts to moderate going forward (i.e. has worked through the rental car and other “temporary” big risers), the peak may have been reached. and there will be a moderation back lower.
That is still a “hope” as filling jobs are pushing up wages, and supply chain issues continue to be a problem, but if the bond market is a forward-looking barometer for the trends, they are pointing toward the transitory inflation that the Federal Reserve members have been talking about.
Looking at the treasury market, the tenure yield is trading down -5.2 basis point to 1.439%. The high yield worked its way up to 1.533% soon after the release. That is quite a turnaround.
US stocks were also supported today, with flows into the Nasdaq leading the way. The S&P closed at an all time record high. The Dow rose modestly. Not fairing so well was the Russell 2000 which fell by -0.68%.
The final numbers in Europe are mixed with modest changes.
In the forex, the market price action remained very up and down volatile for most of the major currency pairs. The GBP is ending as the strongest of the majors. The EUR is the weakest. The USD followed the rates lower and closed mostly lower with the exception being a small gain vs the EUR. The ECB today kept rates unchanged with no change in QE.
In other markets:
- Spot gold rose $11.10 or 0.59% to $1899.67
- Spot silver rose $0.23 or 0.86% to $20.01
- WTI crude oil futures is trading up $0.12 or 0.17% at $70.09. There was a brief selloff on headline news that Iran sanctions would be eliminated against an individual. However, a US official later said that the news did not imply a lessening of the sanctions against the country or all individuals for that matter