The dollar gained across the board in the majors as stronger data out of the US and comments from Fed Chair Jerome Powell helped spur it back to levels not seen since mid-August. The ADP Non-Farm employment number beat expectations overnight along with the ISM Non-Manufacturing PMI data helping to push the dollar and treasury yields higher, with the 10 years trading up to 3.18%. Comments from Jerome Powell that interest rates are accommodative and still ‘some way off’ restraining growth added to the Hawkish sentiment and momentum of the move.
Currencies will be a major focus as we move through the Asian session today with some of the regions majors trading near yearly lows against the greenback. The Aussie and Kiwi are both back within touching distance of this year’s lows and despite strong moves overnight are expected to remain under pressure today with breaks into new ranges possibly stretching the move even further. The Yen also continued on its move lower with UsdJpy now trading close to November 2017’s 114.73 high.
Looking ahead to the rest of today’s trading and it’s relatively quiet on the fundamental data front, the Aussie Trade Balance number is due out during the Asian session but there’s not too much else to trouble the scorers as we move through the day. In the US session we have the Canadian Ivey PMI due out and Fed member Randle Quarles is due to speak but the focus will soon move to Friday’s key data day with the week culminating in the Non-Farm Payroll release.