www.zerohedge.com
While most global equity markets were subdued due to the US
Thaksgiving holiday, the FX world was very busy overnight, marked by the
relentless dollar surge on expectations of a rate hike not only in
December but further in 2017, sending Asian currencies to the weakest
level in 7 years: the Bloomberg-JPMorgan Asia Dollar Index reached
103.32, the lowest level since March 2009.
The regional FX plunge will likely deter regional central
banks from easing monetary policies as the prospects of higher U.S.
rates spurred capital outflows according to Toru Nishihama, an
emerging-market economist at Dai-ichi Life Research Institute who added
that depreciating currencies are making it very hard for central banks
to ease on concerns about inflationary pressure and acceleration of fund
outflows.
The dollar also
pushed its way past more of last year's peaks against the euro to hit
$1.0550 in early European action, with only the March 2015 high of
$1.0457 standing in the way of a drive toward parity, likewise the yen
skidded to an eight-month low and China's yuan to an 8-1/2 year low,
while the highly sensitive Turkish lira and Indian rupee hit new
historic troughs, although the USD has since given up some of the gains.
"There doesn't seem to be anything stopping U.S. yields
going higher in the near-term so I think people are going to stay on the
dollar trend," said Michael Metcalfe, head of global macro strategy at
State Street Global Markets.
"The only risk to this are that the dislocations in markets
outside of the U.S., particularly in emerging markets, get to a point
where they start to feed back into concerns (for the Federal Reserve as
it looks to raise interest rates)," he said.
While so far US equity markets have ignored the jump in the
DXY to a near 14 year highs, dollar gains reverberated through emerging
markets. India’s rupee and Vietnam’s dong slid to records, while the
Philippine peso dropped to its weakest level in eight years. In Turkey,
the lira rebounded from an all-time low after the central bank
unexpectedly raised interest rates, although even that move has now been
faded. Copper’s surge pulled a gauge of commodities higher for a fourth
day, the longest rally in a month. Rosneft PJSC approved a $17 billion
bond program, the biggest ever by a Russian company as the nation’s
largest oil producer refinances debt. Copper was set to close at its
highest level in more than a year.
As Bloomberg writes this morning, central banks worldwide are being pushed to take action in the face of the stronger dollar.
In Turkey, policy makers opted to support the nation’s
beleaguered currency, while the European Central Bank warned that the
risk of an abrupt global market correction on the back of rising
political uncertainty has intensified, posing a threat to banks,
stability and economic growth. The market odds of a December rate hike
in the U.S. are 100 percent and traders are adding to bets that Fed
Chair Janet Yellen will lead further action in 2017. U.S. equity
benchmarks extended records last session before the Thanksgiving
holiday.
“The dollar has been really strong in anticipation of
Yellen’s move next month and that strength in the U.S. dollar is
ultimately going to mean that emerging-market assets would be seen as
disadvantaged,” said Nicholas Teo, a strategist at KGI Fraser Securities
in Singapore.
The Stoxx Europe 600 Index added 0.1 percent, while Japan’s
Topix index climbed for a 10th straight day, on the back of the ongoing
surge in the USDJPY, its longest streak since June 2015. Europe’s top
equity market this month, Greece, is giving signs of overheating: A
technical indicator hit its most-overbought level since October 2013,
meaning that gains might have come too quickly to be maintained.
US equity futures were unchanged at 2201.
European sovereign bonds were broadly higher as ECB
Governing Council Member Francois Villeroy de Galhau was quoted by
Expansion as saying the central bank was mulling many options for its
debt-purchase program. They partially reversed a selloff from Wednesday
that was fueled by a report that the ECB is planning to lend out
securities in an effort to boost bond-market liquidity and reduce
shortages in the repurchase market. France’s 10-year bond yield fell
three basis points to 0.76 percent. Portugal led gains in the region,
with the nation’s 10-year yield falling nine basis points to 3.59
percent. Indonesia’s 10-year sovereign bonds retreated for a sixth day,
sending yields to the highest since March 2.
沒有留言:
張貼留言