US dollar continues to run higher alongside stock markets

‘Purchase America’ is the theme because the market anticipates some form of commerce deal to be introduced later as we speak.

That is led to sturdy US greenback bids throughout the board which have accelerated within the final hour. As well as, inventory markets are on the highs of the day with the S&P 500 up 1.4% and the Nasdaq up 2.4%. After falling into destructive territory pre-market, the Russell 2000 is up 1%.

Except for commerce, one factor that may very well be driving bids is the tone from Congress across the massive tax reduce message. It is powerful to belief a politician however all of the feedback have been constructive and upbeat. I believe the flipside is that it’s going to include an enormous finances deficit as a result of that appears to be the trail of least resistance.

So it isn’t actually a ‘Purchase America’ theme as bonds are promoting off as we speak. Bessent earlier highlighted falling 2-year yields however these have reversed course and at the moment are up 3 bps and up 10 bps from the lows. We have additionally seen Fed reduce pricing within the 12 months forward are available by 6 bps.