Along with commodities that are under pressure once again this morning, inflationary expectations (as measured by the US 10yr breakevens) continue to drop. The turn lower from multi-year range highs in US 10yr breakeven rates also coincides with equity pullbacks and this remains supportive of a corrective move and profit taking for the time being. Commodity currencies remain marginally bearish and price action has yet to suggest that a stronger move is taking hold in FX space. USD/CAD is aiming at its year-to-date highs near 1.0340; it would take a decisive break above this level as an indication that the USD is catching a stronger bid.
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Barclays