Themes

• General mood is “risk off”
• Early interest to sell Dollars on hopes of a Ukrainian ceasefire
• 2s/10s yield curve inverts slightly on the day

What’s Moving

Currency markets saw some players prepare for a ceasefire in the Ukraine overnight, with good buying of the Euro against general USD weakness. The moves weren’t wild, but players did see a moderate USD selling interest across the course of the overnight session.

Adding to the USD weakness was the inversion of the 2-year / 10-year yield curve. This move can signal a recession and a recession would take further U.S. rate hikes off the table. Having said that, it only slightly inverted.

Gold and oil were also weaker overnight, before coming in to close only slightly weaker on the day.

Thoughts

Expect another two-way consolidatory session in Asia today, with a lack of clear clues from overnight trade and with today’s local data calendar relatively light.

Data today sees:

• Japanese Retail Sales (E: -0.3%)