The US dollar continued sliding against most of its major peers, with most major equity indices trading in the green, as bond yields continued to slide. What may have calmed fears over high inflation is the US CPI data for February.
As for today, the ECB decides on monetary policy. Following the latest rally in bond yields, ECB officials sounded concerned and thus, it would be interesting to see whether they will signal more action soon.
YIELDS CONTINUE TO RETREAT ON SOFT US INFLATION DATA
The US dollar continued trading lower against all but one of the other G10 currencies on Wednesday and during the Asian session Thursday. It lost the most ground versus NOK, Australian dollar, New Zealand dollar, and SEK in that order, while it was found virtually unchanged against CHF.
The weakening of the US dollar suggests that Treasury yields continued to pull back, which may have allowed stock indices to trade north. Indeed, turning our gaze to the equity world, we see that most major EU and US indices traded in the green, with the only exceptions being UK’s FTSE 100 and Wall Street’s NASDAQ. The positive appetite rolled over into the Asian session today as well.
What may have calmed fears over high inflation is the US CPI data for February. Although the headline CPI rate rose to +1.7% yoy from +1.4% as expected, the core one ticked down to +1.3% yoy from +1.4%.
USD performance G10 currencies