USD/JPY touches 108.17 as equities continue to move higher on the session
Equity investors continue to price in further optimism surrounding US-China trade talks as European equities climb higher while US futures are holding solid gains on the session.
The DAX is now up by 2% while S&P 500 futures are up by 1% and that is starting to see some spillover to the Japanese yen and Swiss franc. Both currencies are weaker on the session with USD/JPY now at highs for the day around 108.15-17.
It’s all about trade optimism here as investors are “feeling” that a partial trade deal is in the works. They may yet be vindicated at the end of the day but the risk here is that talks don’t go as smoothly and everything we’re seeing so far falls apart in a blink of an eye.
The bond market remains more composed and less enthusiastic as Treasury yields sit near flat levels on the day currently. 10-year yields are up by just 0.2 bps to 1.67%, showing little change relative to the optimism in stocks.