Greg Gibbs, Founder, Analyst, & PM, Amplifying Global FX Capital Pty Ltd, an Australian financial services company explained that US yields are kicking to new highs as the US late-cycle fiscal adventure, and America First (tariff and sanctions) policy tighten their grip on the economy and markets.
Key Quotes:
“We expect this to push the USD to new highs in coming months, even if it points to longer-term risks for the US economy. US Inflation pressure is a major risk for global asset prices, and the CPI data on Thursday may set the tone for the market as it contemplates further evidence of a tightening labor market.”
“Trade policy remains a weight on China and Asian markets. There is no new news on Nafta, but a three-way deal with Canada still seems a likely outcome, helping support the CAD. The market expects no change in the ECB policy outlook. Economic activity and inflation have been stable in recent months. However, European bank shares are significantly weaker, and Draghi is likely to display caution when facing probing questions on the multiple risks facing the region.”
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