Macro Roundup (Nov 26)

SHANGHAI, Nov 26 (SMM) — This is a roundup of global macroeconomic news last night and what is expected today.

The U.S. dollar traded at its highest in over a year to the euro and near a five-year high against the yen as a hawkish tilt by Federal Reserve policymakers, buoyed by strong U.S. data, contrasted to more dovish monetary outlooks in Europe and Japan.

The dollar index, which measures the greenback against six major peers, eased slightly to 96.759, but still hovered close to Wednesday’s high of 96.938, the strongest level since July 2020.

Various Fed policymakers said they would be open to speeding up the taper of their bond-buying program if high inflation held, and move more quickly to raise interest rates, minutes of the central bank’s Nov. 2-3 policy meeting showed on Wednesday.

U.S. stocks pushed modestly higher on Wednesday as the recent jump in bond yields took a breather, allowing tech stocks to recover.

The S&P 500 ticked up 0.23% to close at 4,701.46, while the tech-heavy Nasdaq Composite added 0.44% to finish at 15,845.23. The Dow Jones Industrial Average lost just 9.42 points and settled at 35,804.38.

The recent rise in yields, which started around President Joe Biden’s decision to renominate Jerome Powell as chairman of the Federal Reserve on Monday, cooled slightly on Wednesday. The 10-year Treasury yield has traded above 1.68% this week after ending Friday at 1.55%. However, the benchmark rate had dipped to about 1.64% on Wednesday afternoon.

Oil prices ticked lower on Thursday with investors waiting to see how major producers respond to the emergency crude release by major consuming countries designed to cool the market, even as data pointed to healthy U.S. fuel demand.

U.S. West Texas Intermediate (WTI) crude futures fell 9 cents, or 0.1%, to $78.30 a barrel at 0201 GMT, extending an 11 cent loss on Wednesday.

Brent crude futures slipped 5 cents to $82.20 a barrel, after losing 6 cents on Wednesday.

Gold prices edged up on Thursday as the dollar eased slightly, but comments from U.S. Federal Reserve policymakers suggesting the central bank could accelerate stimulus tapering weighed on the metal and kept it well below the key $1,800 mark.

Spot gold rose 0.2% to $1,792.05 per ounce by 0137 GMT, after slipping to its lowest since Nov. 4 on Wednesday. U.S. gold futures added 0.4% to $1,791.70.

The pan-European Stoxx 600 closed up by 0.4%, with utilities stocks rising 1.8% to lead the gains as most sectors and major bourses entered positive territory.

Investors were digesting fresh political developments in Europe. In Germany, a new coalition government deal between the Social Democrats, Greens and Free Democrats was announced on Wednesday.

Investors continue to monitor rising Covid cases in Europe, which have prompted some countries to introduce new curbs.