Markets are active into the NA session; with abroadly weak USD juxtaposed against stronger equities and a US 10year yield at 2.9%. Hawkish comments from the Fed’s Fisher and Plosser anda general sense that the Fed will look through the weak payrolls releaseand continue to taper its bond buying program helped to support the USD in the Asian and European sessions. In addition, an unexpected jump in China’s reserves suggest ongoing PBoC intervention to limit CNY gains and therefore USD buying. The World Bank increased its outlook for global growth to 3.2% in 2014 and up to 3.4% in 2014 but warned that tapering could weigh on emerging markets. Today’s data is secondtier (PPI and empire) however two non‐voting Fed doves (Evans and Lockhart) and the release of the Beige Book (2pm EST) could providesome interesting insight.
Read the full report: FX Daily
Scotiabank