Daily Market Commentary 26th September 2023

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Bond yields in the US continued to rise higher, hitting highs not seen since 2007, endorsing the ‘higher for longer’ mantra. Energy prices are rising heading into winter, with Russia and Saudi Arabia enforcing heavy supply cuts and Russia imposing an export ban on diesel. The rising cost of energy, heading into the Northern Hemisphere winter, is fueling interest rate fears and putting Central Banks on notice. Data release was limited overnight, but the Dallas Fed Manufacturing Index was heavily negative, along with the Chicago Fed National Activity Index. The slow data week heats up, with inflation and growth numbers from across the US and Europe, being released later in the week. The rising bond yields pushed the US Dollar higher, with the EUR falling below 1.0600, while the GBP crashed to 1.2200.

The rising reserve hit the AUD, which slipped back towards 0.6400, while the NZD tests the downside of 0.5950. Fears of rising inflation continue to dominate markets.

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