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US Treasury yields turned mixed on Friday as the long-end of the curve, the 20s and 30s, posted gains while the short-end and the belly of the yield curve retreated from multi-year high levels. The US 10-year Treasury yield holds firm at 5.20% after peaking at a 19-year high of 5.228%.Long-end yields climb while Fed tightening bets keep 10-year near 5.20%During the session, the 30-year bond yield rose to its highest level in 22 years. Hawkish commentary from Federal Reserve (Fed) officials and last week’s 25-basis-point rate hike were the two main catalysts that pushed US Treasury yields higher during…

ING’s Asia-Pacific research notes that South Korea’s upcoming data should show stronger industrial production and a widening trade surplus, even as export and import growth moderates. Technology and semiconductor exports are expected to underpin the surplus. At the same time, headline CPI is forecast to ease slightly, with core inflation decelerating more sharply, pointing to reduced underlying price pressures.Stronger output with softer inflation”South Korea releases August industrial production data on Wednesday. Market consensus expects industrial production growth to accelerate to 4.5% YoY, from 3.6% in July. Monthly output is forecast to rise 0.5%.””September trade data, out Thursday, is expected to…

Societe Generale describes a limited impact from President Xi’s US visit, with no new tariff cuts or AI dialogue mechanism agreed as the trade truce was only extended to January. USD/CNY rebounded after briefly dipping below 6.70, helped by higher US Treasury yields and a modest easing of PBoC control, while the central bank reiterated a moderately loose stance and commitment to Yuan stability.Policy support and controlled flexibility”China and US extend trade truce until January, but no major new outcomes emerged from President Xi’s visit – even the much-anticipated agreements on additional tariff cuts and an AI dialogue mechanism failed…

Cleveland Federal Reserve (Fed) President Beth Hammack said on Friday the two sides of the Fed’s dual mandate are not in conflict. She said that “high inflation complicates economic planning,” and that she doesn’t see current policy as restraining the economy.Hammack added that inflation expectations are “well anchored.”Key highlights:There are lots of long-term questions on what AI will mean for inflationSides of Fed mandates are generally not in conflictPersistently high inflation has ‘real costs’, pressures wagesHigh inflation complicates economic planningFed policy is not restraining activity outside of housingDon’t see current policy as restraining the economyRising bond yields driven by a…

UOB’s Quek Ser Leang and Lee Sue Ann note USD/SGD held steady around 1.2800 after Wednesday’s surge, with the Singapore Dollar (SGD) supported by expectations of further MAS tightening. Their Singapore Dollar (SGD) Nominal Effective Exchange Rate (NEER) model sits 1.76% above the mid-point, implying a USD/SGD range of 1.2764–1.2828 today, while renewed Dollar momentum keeps focus on resistance at 1.2835.Dollar holds firm against Singapore Dollar”24-HOUR VIEW: Following the strong surge on Wednesday, USD consolidated between 1.2788 and 1.2811 yesterday, closing unchanged at 1.2800. USD is likely to continue to consolidate today, probably between 1.2780 and 1.2815.””1-3 WEEKS VIEW: We…

European Central Bank (ECB) Vice President Boris Vujcic said on Friday that the ECB started a tightening cycle and sees a “risk of higher for longer energy prices.” He added that diesel prices will stay high for a long time, feeding into inflation.Key highlights:We have started a tightening cycleSee risk of higher for longer energy pricesIt seems the price of crude will come down but not that of refined productsDiesel prices will stay for long, feeding into inflation Euro Price Today The table below shows the percentage change of Euro (EUR) against listed major currencies today. Euro was the strongest…

OCBC strategists Sim Moh Siong and Christopher Wong report that Asian FX traded broadly softer as higher Oil prices and rising US Treasury yields hurt risk sentiment, with Indonesian Rupiah (IDR) underperforming and Philippine Peso (PHP), Indian Rupee (INR) and Thai Baht (THB) also weaker. Renminbi (RMB) momentum faded as People’s Bank of China’s (PBoC) stronger fix trend stalled, while holiday closures in China, South Korea and Taiwan are expected to thin liquidity and potentially increase volatility.Regional currencies under pressure”Asian FX traded broadly softer as higher oil prices and US Treasury yields weighed on risk sentiment. IDR underperformed, while PHP,…

The Cleveland Federal Reserve (Fed) President Beth Hammack said on Friday that “the biggest risk with inflation is the formation of an inflationary mindset”, in a panel discussion hosted by the Cleveland Fed, with Vujcic, the Vice President of the European Central Bank (ECB), and Bank of Mexico’s (Banxico) Deputy Governor Jonathan Heath.Hammack reiterated that the Fed needs to make progress in lowering inflation and that it is important to have restrictive policy rates.Key highlights:The biggest risk with inflation is the formation of an inflationary mindsetThe public has been dealing with above-target inflation for an extended periodGrowth has held up…

FILE PHOTO: India’s foreign exchange reserves declined by $14.88 billion to $765.90 billion in the week ended September 18, mainly due to a fall in foreign currency assets. | Photo Credit: LEE JAE WON India’s foreign exchange reserves declined by USD 14.88 billion to USD 765.90 billion in the week ended September 18, according to the latest data released by the Reserve Bank of India (RBI) on Friday.The country’s forex reserves stood at USD 780.78 billion in the previous week ended September 11.Foreign currency assets drive declineAccording to the RBI’s Weekly Statistical Supplement, the decline was mainly driven by a…

Iran has offered to reopen the Strait of Hormuz within seven days of Washington accepting its terms, and buyers have taken the Dow Jones Industrial Average higher before Washington has replied. The index trades near 51,800 on Friday and is on track to end a three-session losing run.West Texas Intermediate (WTI) Crude Oil fell toward $92.00 on the offer. Cheaper fuel helps 29 of the Dow’s 30 members, since Chevron (CVX) is its only oil producer, and it takes some pressure off the inflation the Fed is raising rates to fight. Japan’s Kyodo News reported the same seven-day offer on…