The mood calmed down on Tuesday in the interest rate market after a volatile Friday and Monday. On Friday, a surprisingly strong employment report was received from the United States, which caused the market to re-price the likelihood of interest rate cuts by the central bank Fed in the near future.
On Friday and Monday, interest rates rose not only in the United States but also in Europe, and the dollar strengthened due to increased interest rate expectations.
On Tuesday, the market rate for the US 10-year government bond rose by one percentage point to 4.79 percent. In Europe, interest rate movements were small, mostly around one percentage point in their direction.
On the foreign exchange market, the euro was in the strongest mood of the main currencies. The euro had gained 0.4 percent against the pound, 0.3 percent against the yen and 0.1 percent against the dollar.
You got 1.025 dollars for the euro and 157.89 yen for the dollar.
Market sentiment was calmed by the news Donald Trump’s about the administration’s intentions to gradually raise customs duties.
“A slower and more stable approach with tariffs could reduce the effect of tariffs accelerating inflation and slowing growth, so everyone is cautiously optimistic again”, Pepperstone Group strategy Michael Brown commented to Bloomberg.
Investors’ attention is already strongly focused on the United States’ December inflation figure, which will be announced tomorrow, Wednesday. Inflation is expected to have accelerated to 2.9% from 2.7% in November.
Today we will have figures on the development of producer prices in the United States in December. Producer prices are expected to have grown faster than the previous month.
Source: www.arvopaperi.fi
