Dollar pares gains on the day in European morning tradeTrump making sure that Wall Street stays more upbeat in generalECB's Lagarde: No US tariff is what I expectedECB's Lagarde: We're not overly concerned about export of inflation to EuropeECB's Knot sees little obstacle to another rate cut next weekECB's Stournaras says rates should be close to 2% by end of the yearECB's Villeroy: Disinflation process is still on trackECB's Escriva: a 25 bps cut next week is a likely scenarioECB's Nagel says confident inflation will return to 2% target by mid-yearECB's Rehn: We are aconfident inflation will stabilise at the target as predictedSNB's Schlegel: We cannot exclude negative interest ratesUS MBA mortgage applications w.e. 17 January +0.1% vs +33.3% prior
Markets:
AUD leads, JPY lags on the dayEuropean equities higher; S&P 500 futures up 0.5%US 10-year yields flat at 4.576%Gold up 0.4% to $2,756.59WTI crude down 0.1% to $75.77Bitcoin down 1.3% to $105,392Trump's tariff threats inspired the dollar in Asia but the vibes dissipated in European morning trade, with the greenback surrendering almost all of its early advance.
The changes are not too drastic but it shows that traders are sensing Trump's bark might be worse than his bite, at least on tariffs.
In the equities space, US futures continue to drive optimism as European indices also shrugged off a more tentative start earlier. The DAX is up over 1% to fresh record highs with the CAC 40 also up over 1% to its highest since June last year. Tech shares continue to drive gains in Wall Street with Nasdaq futures seen up 0.9% and S&P 500 futures up 0.5%. Up, up, and away.
In other markets, Treasury yields remain more tepid while gold is continuing its hot start in January again with another round of gains. The high earlier touched $2,763 as buyers are now taking aim at the October high of $2,790 next.
This article was written by Justin Low at www.forexlive.com. Read More Details
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