Futures pointed to a solid day in US equities but they ended up doubling that as the bid in risk was relentless and that extended to commodity currencies. Cable didn’t get in on the action this time as the BOE has turned into a mess, with Broadbent possibly leaking some dovish news in talks with banks. It’s something that likely prompted the BOE’s announcement of a ban on private briefings.
As for risk, it was really a straight-forward trade. Yields fell, perhaps with a nudge from lower core PPI but there was no sudden news or any theme driving it. One spot to watch is China, talk is picking up about an RRR cut, possibly even today. Copper has been curiously bid and there have been big flows into the China tech ETF.
Central bank talk continues to swirl around inflation risks with most bankers now backing away from transitory talk, at least to some degree. The IMF raised inflation concerns today and Morgan Stanley’s CEO rang alarm bells.