Market wrap: dollar makes broad gains in London/NY - Westpac

Analysts at Westpac explained that the US dollar made broad gains in London/NY for a third straight day, up against all G10. 

Key Quotes:

"News and data again weren't key."

"AUD was weaker than most, dropping to 0.7600 for the first time since Dec 2017."

"Today's calendar highlight is Australia Q1 CPI. Also due are Germany Apr IFO business sentiment and US Apr consumer confidence data."

"US bond yields and the US dollar rose."

"The US 10yr treasury yield extended its recent surge but fell fractionally short of the closely watched 3.00% level. The 2.996% high was still the highest since Jan 2014, and 2yr yields rose from 2.46% to almost 2.48% - the highest since 2008. On Bloomberg calculations, Fed fund futures yields pricing for the next rate hike in June rose from 92% to 97% chance."

"These moves were continuations, possibly partly fuelled by expectations inflation may rise. Commodities were lively."

"News that the US could loosen its sanctions on Russian metals giant Rusal sparked a record 9% fall in aluminium prices in NY trade. But Brent crude oil continued its strong run, trading $75/bbl for the first time since Nov 2014."

"The US dollar rose against all G10 currencies, with JPY and AUD weakest, GBP and CHF most resilient." 

"EUR/USD dipped under 1.2200 for the first time since 1 March."

"Having been probing 1.44 just a week ago, GBP/USD slid to the mid-1.39s."

"USD/CAD rose 0.7% to 1.2850, reflecting US dollar strength, not benefiting from the oil price rise though at least CAD outperformed AUD and NZD. BoC governor Poloz reiterated last week’s cautious policy outlook."

"After a quiet Sydney session around 0.7670/80, AUD/USD started to fall in the London morning and extended as far as 0.7600 in NY – the lowest since December. NZD kicked off its decline at the same time as AUD, falling from 0.7205 to 0.7147 – the lowest since January. AUD/NZD remained contained, inside a 1.0630-1.0660 range. USD/JPY rose from 107.80 to 108.75 – a two-month high."

"On the data front, Eurozone April business surveys (PMIs) came in slightly better than forecast, manufacturing 56.0, services 55. The levels still indicate a solid Eurozone economy but Markit’s press releases did highlight the moderation in new orders and slower exports due to EUR strength. Employment stays strong and supply constraints and general price pressures persist but are noted as easier. US existing home sales rose 1.1% in March, a little firmer than expected."