US TSY FUTURES: Bonds Inching Higher
Yield curves holding steeper in late trade, off highs (2s10s +4.317 at -21.115 vs. -18.673 high) as futures inch back near midmorning highs. Trading desks cite modest fast$ and prop acct buying in 2s to 10s, squaring up ahead the extended holiday weekend. Tsy 30YY currently -0.0130 at 3.3479%.
- Note short end Eurodollar futures, lead quarterly EDU2 extends session high to 96.665 (+0.0725) as 75bp rate hike speculation at the Sep 21 FOMC annc has receded to appr 60% vs. 75% Thu.
- With markets closed Monday for extended holiday weekend, Fed speakers have limited time to express their policy leaning ahead next media blackout next Friday at midnight. Fed speaker calendar for week ahead:
- 09/07 0900 Fed’s Barkin Speaks at MIT
- 09/07 1000 Fed's Mester speaks at MNI virtual event
- 09/07 1235 Fed’s Brainard Discusses the Economic Outlook
- 09/07 1400 U.S. Federal Reserve Releases Beige Book
- 09/07 1400 Fed’s Barr Speaks on Financial System Fairness and Safety
- 09/08 0910 Powell Speaks at Monetary Policy Conference
- 09/09 1000 Fed’s Evans Discusses Careers in Economics
- 09/09 1200 Fed’s Waller Discusses Economic Outlook
- 09/09 1200 Fed’s George Discusses the Economic Outlook
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CANADA: USDCAD Flitters Through ISM Beat, Fedspeak
- A whippy session for USDCAD, but one that’s only marginally outside of yesterday’s range in both directions, sees it currently -0.2% at 1.2853.
- Can-US yield differentials have at the margin provided some downward pressure on the pair by increasing circa 5bps since open, but in trend terms remain at the low of a one-month range.
- The latest dip in the pair likely came with a softer USD more broadly rather than comments by Germany’s Baerbock on the ‘huge potential’ for energy ties, preserving relative performance to other majors as of early this morning (i.e. CAD on a par with AUD but lagging NOK and SEK).
- There has ultimately been little change from a technical perspective, keeping the bearish focus with notable support eyed at 1.2767/2763 (Aug 1/Jun 13 lows) whilst to the upside, resistance at today’s overnight high of 1.2892 and then 1.2947 (Jul 25 high).
MNI EXCLUSIVE: MNI Interviews ISM Services Head On Firms' Recession Fears
- MNI interviews the ISM services chief on U.S. firms' recession fears
- On MNI Policy MainWire now, for more details please contact sales@marketnews.com
GBPUSD TECHS: Bull Cycle Still In Play
- RES 4: 1.2518 High Jun 6
- RES 3: 1.2406 High Jun 16 and a key resistance
- RES 2: 1.2332 High Jun 27
- RES 1: 1.2293 High Aug 01
- PRICE: 1.2108 @ 16:18 BST Aug 3
- SUP 1: 1.2089/63 20-day EMA / Low Jul 29
- SUP 2: 1.1961 Low Jul 25
- SUP 3: 1.1890/1760 Low Jul 21 / Low Jul 14 and the bear trigger
- SUP 4: 1.1673 1.00 proj of the May 27 - Jun 14 - 16 price swing
GBPUSD drifted somewhat during Tuesday trade and remained under pressure into the Wednesday close. A bullish short-term theme remains intact though following gains posted Monday. Price has recently traded above the 50-day EMA. This reinforces short-term bullish conditions with the next objective at 1.2332, the Jun 27 high. Potential is also seen for a climb towards 1.2406, the Jun 16 high and a key resistance. On the downside, initial firm support to watch lies at 1.2063, the Jul 29 low.
