Friday February 9, 2018 - 15:25:06 GMT
Share This Story
Global-View - www.global-view.com
Markets Dealing With Extreme Turmoil
John M. Bland, MBA, co-founder, Global-View.com
Equity Markets Volatile As Prices Correct Following an extended period with no correction, share markets finally paused after fixed income markets started to worry about rising market interest rates in the U.S. as expectations for a rising U.S. budget deficit mount. The benchmark 10-yr bond yield has decisively broken out of its previous well- worn 2.70%-2.80% fluctuation range to a new level supported at 2.80%. Late this week the 2.90% level was approached and many fell that the 3.00% line will be seen fairly soon.
As equities went through periodic levels of adjustment, bonds saw a “flight-to-safety” bid for U.S. securities, which drove bond yields back lower, but those yields bounced back quickly when the selling abated. The USD "flight-to-safety" trade had abated by early Friday. Rates appear to setting a new higher base, which is an adjustment to a faster pace of growth in the U.S. economy and increased structural borrowing requirements.
The forex markets were not immune to the price swings. The of “flight-to-safety” moves into U.S. instruments generated USD demand, which saw the USD trade higher vs. the EUR and other currencies. The JPY also gained as overseas Japanese investors brought funds (repatriation) back to their home currency. On the other hand, the Nikkei tended to trade in tandem with other overseas indices.
Bank Of England Sends Markets A Hawkish SignalOn Thursday, the Bank of England sent the markets a signal that rates might have to rise faster than by what had been foreseen in its November statement. Markets had been expecting a rate hike in the latter half of this year. After this meeting traders raised their odds on a rate hike to 75% in May of this year. The announcement saw sterling initially rise vs. the USD, Euro and Yen only to sell-off soon thereafter. U.K. market interest rates gained as well. The Bank of England appears to be adjusting to mounting inflationary pressures in the U.K.
GVI Trading. Potential Price Risk Scale
AA: Major, A: High, B: Medium
Mon 12 Feb 2018
A 07:15 CH- CPI
Tue 13 Feb 2018
AA 08:30 GB- CPI
Wed 14 Feb 2018
AA 00:30 AU- Employment
A 10:00 EZ- GDP
AA 13:30 US- CPI & Retail Sales
A 15:30 US- EIA Crude
Thu 15 Feb 2018
00:00 CN- Holiday
A 13:30 US- Empire PMI & Philly Fed
A 14:15 US- Industrial Production
Fri 16 Feb 2018
00:00 CN- Holiday
AA 09:30 GB- Retail Sales
A 13:30 US- Housing Starts/Permits
A 15:00 US- University of Michigan
Be sure to refer daily to Global-View to see the continuously UPDATED Economic Calendar and the Forex Forum for the complete list of key items (actual economic and central bank data, selected charts, etc.) as they are released. Since 1997, Global-View.com has featured live discussions by active traders of current developments in the forex market in a convenient timeline format. Our latest innovation is The Amazing Trader, which is an Expert Advisor (EA) you can load directly to your MT4 platform for assistance in trading various markets.
Forex Trading News
Daily Forex Market News
Forex news reports can be found on the forex research
headlines page below. Here you will find real-time forex market news reports
provided by respected contributors of currency trading information. Daily forex
market news, weekly forex research and monthly forex news features can be found
Real-time forex market news reports and features providing
other currency trading information can be accessed by clicking on any of the
headlines below. At the top of the forex blog page you will find the latest
forex trading information. Scroll down the page if you are looking for less
recent currency trading information. Scroll to the bottom of fx blog headlines
and click on the link for past reports on forex. Currency world news reports
from previous years can be found on the left sidebar under "FX Archives."