EUR

Hopes for a soft landing in the US economy are slowly fading, but strong corporate earnings are keeping asset prices elevated for now. North American equity futures are pointing to a modestly stronger open after a series of better-than-expected earnings releases, and the trade-weighted greenback is up slightly as flows into US markets offset concerns about the longer-term outlook. We’re reminded of the old joke about the optimist who jumped off the Empire State Building – as he was falling, someone asked, “How’s it going?”, and he responded:“So far, so good!” Yields on both sides of the 49th Parallel remain...

The dollar is tumbling this morning as a narrowing in expected growth differentials between the United States and other major economies spurs outward capital flows. After a number of Federal Reserve officials laid out the case for a slower pace of rate hikes and a series of data releases showed softness emerging in American industrial production and consumer consumption levels, investors are piling into bets on the euro, yen, and commodity-exporting emerging markets. Speculators are net short the dollar on a scale not seen since the middle of 2021 – just before the last historic rally got underway. Make of...