• A global selloff accelerated following a surprising increase in US inflation, putting pressure on the Federal Reserve to tighten monetary policy. Treasury yields have been trading at a multi-year high.
  • The S&P 500 futures fell 2.5 percent, while the Nasdaq 100 contracts fell 3.1%. After Friday's surprise consumer pricing report sparked a $1 trillion selloff, the S&P 500 is flirting with a bear market. The Stoxx 600 index hit a new low for the first time since early March.
    The yield on 10-year US Treasury notes hit 3.24%, the most since October 2018, while a selloff in European government bonds accelerated, with the yield on Germany's two-year government paper climbing above 1% for the first time in over a decade.
    By September, traders expect the Fed to tighten by 175 basis points, meaning two half-point and one 75-basis-point boost. If that happens, it will be the first time the Fed has taken such draconian steps since 1994.
    175 basis-points of Fed hikes seen by September, with at least one 75 basis-points move.
  • ECB depo rate is seen at 0.75% in October, implying 2 half-point hikes.
  • 125 basis-points of ECB hikes priced by October puts two 50 basis-points hikes in play.
  • Iran said the nuclear deal is still possible and within reach.
Osama G
Osama G