February 2, 2023

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The NZD is the strongest and the USD is the weakest as NA traders enter for the day

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Risk on flows today

The NZD is the strongest and the USD is the weakest as NA traders enter for the day. If yesterday saw risk off flows, today we are seeing risk on flows as stocks move back higher in Europe and in the US.  Janet Yellen walked back her comment yesterday that a interest rate rise may be needed (she may have forgotten that she was Treasury Sec. not the Fed Chair anymore).  The NZD was helped by a strong jobs report (in addition to “risk on” flows).  Fed’s Rosengren, Mester and Evans speaks today. THe ADP will be out shortly with expectations of 850K  (the data came in at 742K vs 850K estimate. The prior month was revised up to 564K vs 517K previously reported)
Risk on flows _today

Looking at the ranges and changes, the NZDUSD is the biggest mover and also near session highs as it has trended higher today. The USDCAD, AUDUSD are also showing USD weakness. The EURUSD and the USDCHF have erased earlier gains and are now near unchanged on the day.  

The ranges and changes for the major currency pairs

In other markets

  • Spot gold is trading down  -$1.11 or -0.06% at $1777.95
  • Spot silver is down $0.18 or -0.7% $26.32.
  • WTI crude oil futures are trading up $0.80 or 1.22% at $66.49
  • Bitcoin is trading up $520 or 0.95% have $55,296. Dogecoin is higher today in anticipation that Elon Musk will mention the digital currency during his hosting of SNL this weekend (UGH).

In the premarket for US stocks, the major indices have moved higher in premarket trading. The Dow industrial average was the only index which closed higher yesterday after a late day surge. The NASDAQ index felt -261 points or -1.88%

  • Dow industrial average – +80.97 points
  • S&P index – +18.34 points
  • NASDAQ index +101 points

In the European equity markets, the major indices are also trading higher:

  • German Dax, +1.51%
  • France’s CAC +0.9%
  • UK’s FTSE 100, +1.2%
  • Spain’s Ibex, +1%
  • Italy’s FTSE MIB, +1.4%

In the US debt market, the yields are marginally higher with a tilt to the upside in the two – 10 year yield spread.

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