Morning Commentary: Slipping Quietly into the Weekend
A daily summary and commentary of events and factors that affect the global markets, with a particular emphasis on the foreign exchange markets.
Slipping Quietly into the Weekend
Share this story:
David Atkinson Foreign Exchange Sales Manager
We come to the end of this week with very little fanfare. The dollar is again stronger today against most currencies, but by fractions. Asian equities ended trading overnight slightly up only to be followed by European equities taking a slight dive. U.S. equities are opening up fairly flat. The giant bond markets have probably been the most boring this week, with almost no movement to speak of in the major economies. There are interesting stories when we go further into emerging markets, such as a surprise rate hike from Turkey yesterday.
We touched on gold earlier in the week, and it has broadly continued to drop this week, around $1858 as I write. The story being discussed in gold relates to how quickly governments can reflate their economies. “Reflate” is a tricky term these days though. For the Fed that would mean getting back to where they are within spitting distance of the 2% target rather than halfway between zero and the target – or “average” as the target is to be known going forward.
A big part of the U.S. discussion is on whether there will be a fourth stimulus package. Based on the action in gold markets, I am beginning to think that Senate Majority Leader McConnell has a point when he says that even with broad agreement on general amounts, the legislation process of working through the details will not be finished before the election.
A side story that is developing that could be interesting is James Bullard, president of the St. Louis Fed. After earning dovish credentials in recent years, he said in an interview this week that he thinks the U.S. economy has a shot to completely recover by year’s end, even to the point of not needing any more stimulus. Frankly he is alone among his Fed colleagues in saying that, but Bullard has been prescient in recent years in foreseeing economic trends before they became apparent to everyone else.
The only real data point today was U.S. Durable Goods in August, which rose 0.4%. That was below expectations but some analysts are seeing some good signs in the details on equipment orders and inventory levels.
Have a great weekend all. Andy is back Monday after a few well-deserved days off and we all look forward to his return.
Want to learn more about international finance, economics, and global events? Sign up for our other Foreign Exchange emails and videos!
Follow City National Bank on social media:
Non-deposit investment products:
Are not FDIC insured,
Are not deposits or other obligations of City National Bank and are not guaranteed by City National Bank, and
Are subject to investment risks, including possible loss of the principal invested.
This report is for general information and education only and was compiled from data and sources believed to be reliable. City National Bank does not warrant that it is accurate or complete. Opinions expressed and estimates or projections given are those of the authors as of the date of the report with no obligation to update or notify of inaccuracy or change. This report is not a recommendation or an offer or solicitation to buy or sell any financial instrument discussed. It is not specific investment advice. Financial instruments discussed may not be suitable for the reader. Readers must make independent investment decisions based on their own investment objectives and financial situations. Prices and financial instruments discussed are subject to change without notice. Instruments denominated in a foreign currency are subject to exchange rate and other risks. City National Bank (and its clients or associated persons) may engage in transactions inconsistent with this report and may buy from or sell to clients or others the financial instruments discussed on a principal basis. Past performance is not an indication of future results. This report may not be reproduced, distributed or further published by any person without the written consent of City National Bank. Please cite source when quoting.
Here's what this indicator is saying about US stocks right now. ACTIVE INVESTOR WEEKLY EDITION: January 21, 2022 View in a browser FIDELITY VIEWPOINTS ® WEEKLY EDITION: January 21, 2022 Bollinger band stock signal Here's what this indicator is saying about US stocks right now. Read more CHART OF THE WEEK Inflation and corporate consolidation US industries have become
Learn how to keep all your accounts—not just the ones at Fidelity—secure. November 18, 2021 View in a browser FIDELITY VIEWPOINTS ® WEEKLY EDITION: November 18, 2021 What to do after a data breach Learn how to keep all your accounts—not just the ones at Fidelity—secure. Read more What's ahead for your RMDs Make sure to take your required withdrawals this year, then start to plan ahead.