An expansionary and stronger than expected Chinese PMI of 50.8 has done little to support currencies; with the USD broadly stronger. U.S. bond markets continue to be the focus; with yields still close to their 11‐months lows; the collapse in yields has comeon the back of: 1) a shift in the global growth outlook; 2) recalibration of the expectation for central bank hiking cycles; 3) relative value in bond markets and 4) supply/demand in Treasurys and flows. With all the focus on bonds, currency markets stood on the sidelines. This week should prove more exciting for FX with the ECB, BoE, BoC and RBA central bank meetings and several important data releases, including nonfarm payrolls on Friday (consensus is calling for 215k).
Read the full report: FX Daily
Scotiabank