Archives of “March 23, 2021” day
rssUS Treasury to sell $60B of 2 year notes at the top of the hour
The 6 month averages for the 2 year auction
- Last auction high yield 0.119%. The average over the last 6 months 0.139%
- Bid to cover. 2.52x six-month average
- Dealers. 32.6% six-month average
- Directs: 15.1% six-month average
- Indirects: 52.3% six month average
Powell has all the ammo..
EURUSD trades to new lows
EURUSD approaches 200 day MA
Bank of Spain cuts economic outlook
More signs of slowing in the eurozone economy
- Sees economy shrinking by 0.4% q/q in Q1
- Revises 2021 GDP to 6% from 6.8% forecast in December
- Sees 2022 GDP rising 5.3%
- Sees inflation this year at 1.4% from 0.6% in December
- Sees inflation 0.8% in 2022 and 1.2% in 2023
- Sees unemployment this year at 17% vs 18.3% in December
Dollar to stay buoyed, euro to underperform – Barclays
Barclays says that the dollar “offers the best of both worlds”
EUR – To underperform “mainly due to the euro area’s sluggish economic recovery, which will create a growth gap not only between the euro area and the US, but also between the euro area and the UK, Scandinavia and the antipodeans. This is largely manifested by the opening gap between US and euro area long-term rates, but it should be also reflected by FX.” They forecast EUR/USD to be at 1.14 at year-end.
JPY – To “remain under downward pressures in the coming quarters due to reduced safe-haven demand amid global growth recovery, widening foreign-domestic yield differentials, and the potential revival of capital outflows through both investment and M&A.” They forecast USD/JPY to be at 111 at year-end.
GBP – To outperform both the dollar and euro on the quick vaccine rollout and “generous fiscal stimulus”. They forecast GBP/USD at 1.40, EUR/GBP at 0.81 at year-end.
Dollar continues to move from strength to strength so far on the session
Dollar continues to keep higher across the board in European morning trade
Treasury yields dribble lower in European morning trade
10-year Treasury yields fall over 5 bps to 1.641%
As much as a relief in the bond market may be good news for general market sentiment, the latest push lower in yields has that sense of a risk-off element to it.
Eurostoxx futures -0.4% in early European trading
softer tones observed in early trades
- German DAX futures -0.3%
- UK FTSE futures -0.5%
- Spanish IBEX futures -0.5%