The main headlines Monday were from Fed members rejecting Bullard's talk of delaying the end of the taper but markets were unfazed. The US dollar was the laggard while the kiwi led the way as stocks drove upbeat risk appetite. The focus now switches to China with Q3 GDP due. Our ongoing in Premium trades
remain AUDUSD, GBPUSD our most recent Premium trades
, there are 2 GBPUSD, AUDUSD and NZDJPY. A new set of Premium trades shall be issued on Wednesday night.
Fed members Rosengren and Fisher – on opposite sides of the hawk/dove spectrum – both underscored a willingness to continue tapering heading into the trading week. That could have boosted the dollar and hurt risk assets. IT giant IBM also warned on profits in a blow to hopes for business investment.
Yet stock markets rallied nearly 1% and the US dollar sagged. We struggle to tie these events to news and instead point to strong weekend sentiment and talk about a bottom in stocks. The Treasury market was much more cautious with yields moving 1-2 bps lower.