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The 10-year US Treasury note yield stands at 3.88%. The 2-year note yields 4.35% after paying around 0.75% at the beginning of the year. One factor that is leading to another, as inflation is expected to probably surge again, pushing yields at the shorter end of the curve higher. Consequently, concerns about a potential recession are reignited.
Key Developments
OPEC+ detached from the Russian decision to cut oil exports to countries that decided price cap on the Russian energy exports. Crude oil edged lower intraday but later trimmed those losses ahead of the close. WTI traded around $78.80 a barrel.
The American dollar marginally advanced during the US trading session, boosted by the prevalent positive market sentiment. The USD/JPY traded at 134.17, up by 0.54%. The dollar rallied a little bit against the Japanese yen during the US trading session on Wednesday, but it is obvious that the American currency is struggling to shyly hang on to gains later in the session away from the 200-Day EMA.
Global stock markets closed in the red territory, with the focus still on China and the potential effects of a full reopening. News that China was shifting away from the zero-covid policy to push economic growth were later dimmed by reports on Italy, the US, the UK and South Korea imposing restrictions on flight passengers arriving from China because of cases that have already been found onboard.
Spot gold eased further but managed to retain the $1,800 level and trades at $1,805 a troy ounce. Commodity-linked currencies were firmly lower on Wednesday, obviously impacted by stocks and oil prices. The USD/CAD pair traded at around 1.3600, while AUD/USD hovered around 0.6740.
The EUR/USD pair remains above 1.0600, down for the day while GBP/USD hovers around 1.2025. Finally, the USD/JPY pressures its weekly highs in the 134.30 region.
Economic Data
On the data front; Richmond Fed Manufacturing Index improved to 1, exceeding the previous month’s contraction to -9. Moreover; US Pending Home Sales declined, though sentiment lifts the US dollar.
Also Read
UK, Italy impose restrictions on passengers arriving from China
Oil prices retreat on demand-linked uncertainity
USD/CAD boosted by marginally stronger US dollar, risk aversion
How is the USD/JPY pair reacting to the dollar’s rally on Wednesday?
Dow Jones surges on weaker Pending Housing Data
EUR/USD retreats from 13-day highs to fresh daily lows
