GOLD TECHS: Trend Needle Points North

The major currencies are firmer against the USD, although safe havens JPY and CHF are away from best levels as US equity futures recovered some ground. The BBDXY index was last near 1269.7, off around 0.10% versus end NY close levels from Monday. 

• Focus today has remained on US equity trends. Eminis slumped after re-opening, down 1%. This was fresh lows for the active contract back to Sep last year. US growth concerns still remain, although we didn't see any fresh catalyst for this morning's move down.
• Sentiment has stabilized as the session progressed, with Eminis now marginally higher for the session. We did enter oversold territory for the active contract (based off RSI 14), which may have helped drive some short covering.
• USD/JPY got to fresh lows of 146.54, before stabilizing with US equity futures. We were last near 147.05/10, still up around 0.15% in yen terms. Earlier data showed weaker than forecast Jan household spending, while Q4 GDP was revised down due to flat consumption growth. This underscores policy efforts to boost real wages growth this year (something endorsed by PM Ishiba yesterday).
• USD/CHF is back under 0.8800, around 0.20% stronger in CHF terms. EUR is near 1.0850, also up modestly.
• AUD and NZD are tracking modestly weaker. Data prints in both countries today not shifting sentiment. AUD/USD was last under 0.6270, while NZD was under 0.5690, challenging EMA support.
• US yields are lower but away from session troughs. The 10yr got to 4.15% not long after the open, following US equity futures. We were last near 4.18%, still off 3bps.
• Looking ahead, US January JOLTS job openings/layoffs print and given growth concerns are likely to be monitored closely. Bloomberg consensus is for steady 7600k vacancies and a slight pickup in layoffs to 1806k. The Eurogroup/Ecofin meetings take place today.

JGB futures are sharply higher and at session highs, +85 compared to settlement levels.

• “Japan's Economy Minister Ryosei Akazawa said on Tuesday the government will work closely with the Bank of Japan (BOJ) in reaching its 2% inflation target as rising living costs hurt households. The government and central bank are striving to achieve the inflation goal in a stable manner and have made some progress so far, and Akazawa said in a regular press conference.” (per RTRS)
• Cash US tsys are 2-4bps richer, with a flattening bias after yesterday’s robust bull-steepener. The US 10-year is currently 3.8bps lower at 4.173%, after hitting a low of 4.15% earlier. Today’s key US release is January JOLTS job openings, with February CPI on Wednesday.
• Cash JGBs are flat to 8bps richer across benchmarks, with the futures linked 7-year and 10-year leading the rally. The benchmark 10-year yield is 8.4bps lower at 1.493% versus the cycle high of 1.584% set yesterday.
• Swap rates are 3-5bps lower. Swap spreads are mostly wider.
• Tomorrow, the local calendar will see PPI and BSI Industry Survey data alongside 20-year supply.

In today's Asia-Pac session, TYM5 is currently at 111-19+, 0-09 from closing levels, after trading as high as 111-25 early on equity market weakness.

• Block Buy: +4,050 of TYM5 at 111-17+, post-time 04:08:07 GMT. The contract has traded higher since.
• Cash US tsys are 2-4bps richer, with a flattening bias after yesterday’s robust bull-steepener. The US 10-year is currently 3.8bps lower at 4.173%, after hitting a low of 4.15% earlier.
• Today’s key release is January JOLTS job openings, with February CPI on Wednesday.