Financial Markets Daily Report12 July 2023
Investors traded in a subdued mood on Tuesday, as they awaited today’s US CPI report and digested the latest dovish comments from several Fed officials on Monday: Bostic, who said that inflation could be brought back to target without further rate hikes; and Daly, who said the Fed was approaching «the last part» of its hiking cycle.
- Investors traded in a subdued mood on Tuesday, as they awaited today’s US CPI report and digested the latest dovish comments from several Fed officials on Monday: Bostic, who said that inflation could be brought back to target without further rate hikes; and Daly, who said the Fed was approaching «the last part» of its hiking cycle.
- On the data front, the ZEW index showed that German business sentiment fell more than expected in July, a month in which German inflation halted its cooling path. German businesses morale contrasts somewhat with the US data, where small business optimism rose slightly from multi-year lows, according to the NFIB index.
- In this context, sovereign bond yields rose tepidly in the eurozone, as did short-term US ones. Longer-dated US yields fell slightly, further inverting the US curve. Stocks rose across the board, while the dollar depreciated against its main peers, more notably versus the Japanese yen.