Yellen speech sure to spark interest, tensions in North Korea escalate
A quieter day on the announcement front, with the Fed Chair’s speech in the early hours of tomorrow morning coming into focus. Meanwhile, the North Korean situation threatens once again to get out of hand.
North Korea has accused the US of declaring war on it, with the rogue state asserting it now has the right to shoot down US bombers. The US has flatly denied these allegations and said that they are absurd. The US press secretary again reiterated that the US wants to find a non-military solution.
The Euro trended lower overnight as the German election appeared to weigh the currency down. the EUR/USD pairing has dropped from $1.1952 late on Friday to $1.1846 yesterday. The pairing has bumped up a touch since then, where it currently sits at $1.1854. The speech by Janet Yellen may yet again affect the pairing, so it will be intriguing to listen to her speech. The pound has retreated off its highs of late last week to trade below the $1.35 level. The GBP/USD pairing is currently trading at $1.3471.
All three major US stocks finished lower overnight as tensions North Korea rose. The NASDAQ was the worst performer, down 56.33 points (-0.88%) to close at 6,370.59. The Dow shaved 53.50 points (-0.24%) to finish at 22,296.09 while the S&P was the best of a bad bunch, down 5.56 points (-0.22%) to close at 2,496.66. European stocks were a mixed bag, with the FTSE down 9.35 points (-0.13%) to close at 7,301.29. The DAX ended the session flat, posting 2.46-point gain (+0.02%) to end at 12,594.81.
Gold has finally shown signs of life again after being belted over the last week or so. Gold jumped from around $1,295.00 early yesterday to its current level of $1,312.30 as investors pull out of equities and flock to the safe-haven asset. This has been mainly due to the escalation of tensions with North Korea and the threat of war.
Looking ahead to today and investors will be keenly watching the speech mad by Fed Chair Janet Yellen. As the head policy maker at the US central bank, what she has to say is generally considered quite important for the economy and markets alike. Other announcements today include:
US – CB Consumer Confidence, New Home Sales, Richmond Manufacturing Index, S&P/CS Composite-20 HPI, Fed Member Lael Brainard speaks
Europe – German Import Prices
UK – High Street Lending