Global markets kicked off the week on a softer note, with rising yields and renewed oil volatility weighing on investor sentiment. The US dollar initially extended losses as softer US jobs, inflation and retail sales data tempered expectations for Federal Reserve tightening. But the move reversed as US crude jumped above $85 per barrel, reviving inflation concerns and demand for the greenback.
In FX, USDJPY is pushing back toward the critical 160 level despite growing pressure on the Bank of Japan to address persistent yen weakness. Meanwhile, the outlook for EURUSD is becoming more constructive as the pair breaks out of its recent bearish trend. Beyond short-term oil volatility, softer Fed expectations, a cautious ECB and longer-term concerns around US debt and dollar debasement could continue to support the euro. But geopolitical tensions and a renewed European energy shock remain important risks to that outlook.
Watch the full episode to find out more!
Intro1:10 Market update: rising oil prices weighs on risk appetite, support USD
2:05 But longer term USD appetite in limbo
2:56 Deep dive into USDJPY outlook
4:20 and the EURUSD outlook
