Oct 10, 2022
VOT Research Desk
Key News – Insights and Analysis
The Market Perspective:
Traders go for Risk Aversion to start the week
Early on Monday, investors look for safety, and demand for risk-sensitive assets is low. The US Dollar Index (DXY) is gaining ground toward 113.00 after closing the previous week on a solid footing on the positive September jobs report in the United States. The negative trading range of US stock index futures is indicative of the risk-averse market environment. Due to the Columbus Day holiday in the United States, the US bond markets will be closed, and trading may remain muted for the remainder of the day. The Sentix Investor Confidence data for October will be included in the European economic docket.
Friday’s data from the US Bureau of Labor Statistics showed a 263,000 increase in nonfarm payrolls. The market expected an increase of 250,000, but this reading was higher. The publication also demonstrated that the unemployment rate decreased from 3.7 percent in August to 3.5 percent in September. Following the release of the data, the benchmark yield on the 10-year US Treasury bond increased by more than one percent and reached the range of 3.9%. Additionally, the greenback continued to outperform its rivals.
On Monday, EUR/USD remains under slight bearish pressure and continues to fall toward 0.9700.Francois Villeroy de Galhau, a policymaker at the European Central Bank (ECB) and head of the Bank of France, stated that it would take the ECB two to three years to bring inflation back to the 2% target.
After a sharp decline on Friday, GBP/USD is trading below 1.1100 early Monday in a narrow range. The Bank of England said on Monday that it will start a temporary expanded collateral repo facility to help the market work. However, the change doesn’t seem to be affecting how well the British pound does against other currencies.
During the Asian session, USD/JPY reached 145.66, its highest level since the Bank of Japan intervened, but quickly lost ground. At 145.30, the pair was last seen trading flat for the day.
When gold fell below $1,700 and extended its slide below $1,690, it was subjected to additional technical selling pressure.
As it failed to stage a rebound over the weekend, Bitcoin fluctuates in a narrow range below $20,000Ethereum is fluctuating between $1,300 and $1,600 without making a clear move in either direction.
