Market wrap: US dollar and US rates helped by data - Westpac

Analysts at Westpac offered a market wrap.

Key Quotes:

"Global market sentiment: The US dollar and US interest rates rose in the approach to this week’s Fed meeting, helped also by stronger economic data.

Interest rates: US 10yr treasury yields initially dipped to 2.40% but reversed around the time of the consumer confidence and wholesale trade data to 2.48%. 2yr yields rose from 1.11% to 1.14%. Fed funds futures continued to imply a 100% chance of a rate hike on 14 December, and two more rate hikes priced in for 2017.

Currencies:  The US dollar index gained around 0.5%, futures speculators increasing their long-USD positions further. EUR fell from 1.0630 to 1.0531, perhaps also hurt by news Italy’s third largest bank was refused a bailout extension from the ECB. The safe-haven yen underperformed, USD/JPY rising from 114.50 to 115.33 – a 10-month high. AUD fell from a London midday peak of 0.7496 to 0.7436, closing at 0.7456. NZD fell from 0.7188 to 0.7126. AUD/NZD rose from 1.0380 to 1.0450."