Financial Markets Daily Report
25 May 2022

In yesterdays session traders searched for safe-haven assets, following weak economic data and hawkish comments from some ECB members, arguing in favor of a 50bp hike in the policy rate in July.

FMDR
  • In yesterdays session traders searched for safe-haven assets, following weak economic data and hawkish comments from some ECB members, arguing in favor of a 50bp hike in the policy rate in July.
  • Except in Germany, where the Composite PMI edged up by 0.3 points to 54.6, flash PMIs declined in the rest of advanced economies, although remaining comfortably in the expansion territory (above 50 points). In the US, new home sales plunged by 16.6% m/m to a seasonally adjusted annual rate of 591,000 units in April, a two-year low.
  • In stock markets, equities declined across most European trading floors and in the US, where defensive sectors limited the fall in the S&P 500. In fixed income markets, yields on US Treasuries and on the German sovereign bonds edged down across most maturities, while the EUR strengthened against the USD, closing slightly above 1.07.
  • Today the focus will be on the release of the last FOMC meeting minutes (May 4th).
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