Macro Morning

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The US debt ceiling negotiations were finally resolved on Friday, giving Wall Street and other risk markets a boost. The latest core PCE (personal consumption) index showed an uptick in spending in the US which sent inflation expectations higher and boosted the USD as a result.

Currency markets continue to flow to the safety of USD with Euro remaining well below its previous weekly low while the Australian dollar continues to collapse under the weight of the Federal Reserve’s intentions, heading straight to the 65 cent level.

Meanwhile US Treasury yields lifted on the spending news, particularly the 2 year while the 10 year broke through the 3.8% level while oil prices consolidated their recent upticks for a mild move higher with Brent crude finishing at the $77USD per barrel level. Gold remains in lockstep with the other undollars and is still depressed well below the $1950USD per ounce level.

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