Global equity markets reacted to further pressure from the US Bond market, with the US 10-year bond yield looking to test the important psychological 5% mark. The inflationary pressures remain in the US and European economies, with energy prices on the rise and adding to the likelihood of further rate rises from the Federal Reserve. The ECB meet to decide their latest moves in interest rates and monetary policy. Punters are predicting that the Central bank will leave rates untouched, as headline inflation continues to tumble, although the underling pressure is higher. The Bank of Canada left rates unchanged, now attention will turn to the Fed and speculation of a rate rise to come. US New Home Sales jumped 12.3%, as housing stocks remain challenging, although US Building Permits reflect the expense of building, plunging 4.5%. The rise in bond yields added backbone to the US Dollar, with the EUR falling to 1.0570, while the GBP fell back towards 1.2100.
Australian headline inflation tumbled from 6% to 5.4%, but the Q3 number of 1.2%, was substantially higher than the Q3 2022 number. Inflation remains a serious concern within the Australian economy, but will be ignored by the RBA Governor, who was appointed to do the Governments bidding. The rising reserve added pressure to the commodity currencies, with the AUD testing the downside of 0.6300, while the NZD may dip below 0.5800. The ECB rate decision, US GDP growth data and US PCE inflation measures, all await nervous markets.