Traders pondered bond-market gyrations spurred by fears about inflation and monetary tightening as US futures sank along with European markets on Friday.
After announcing poor earnings on Thursday, futures on the S&P 500 and the Nasdaq 100 retreated in pre-market trade, predicting a likely loss of about $180 billion in total market value when the US reopens.
For the first time since the US government restored a two-decade maturity in 2020, the curve between 20 and 30-years has reversed. Bond markets are being tossed about by inflationary pressures and the likelihood of interest rate rises. The dollar rose off a one-month low, but crude oil prices varied. The US 10-year Treasury yield increased.
Eurozone money markets have increased their rate hike bets even further, now pricing in a more than 90% possibility of a 10-bp ECB boost in July 2022 IRPR.
OPEC+ JTC lowers 2021 oil demand growth prediction slightly to 5.7 million BPD - two sources.
ECB SPF: 2022 inflation is expected to be 1.9% versus 1.5%, with 2023 inflation expected to be 1.7% versus 1.5%.
ECB SPF: We anticipate 2021 GDP growth at 5.1%, vs 4.7% three months earlier, and 2022 growth at 4.5%, down from 4.6%.
Traders now expect an ECB rate rise of 20 BPS in October 2022 rather than December 2022 - Sources
France's Finance Min. Le Maire: 6.25% GDP growth anticipated for 2021 is now definite.
France's Finance Min. Le Maire: Q3 economic growth was exceedingly good and France's economy is on the right track.
