Forex News April 30, 2022
As the clock approaches the Fed decision next Wednesday, the stock market is reacting negatively. Amazon shares are down more than 14% on the day, with the stock closing below its 200-week moving average for the first time since 2009.
Apple’s earnings were not as bad, but they warned about a revenue hit from China, which served as a reminder of the impact of the Covid lockdown on not only Apple, but others who rely on supply from that country.
Meanwhile, the Fed will raise rates by 50 basis points on Wednesday and has more or less signalled another 50 basis points and other tightenings through the end of the year as they try to break some of the inflationary run and get their target rate closer to the neutral rate of 2 percent to 2.5 percent.
In anticipation of this, interest rates rose today, adding to the stock market’s woes. The 30-year yield is back above 3.00 percent after falling to 2.82 percent at the week’s low. The two-year yield has also returned to near the cycle high of 2.787 percent. The 10-year yield is now 5 basis points lower than its cycle high of 2.981 percent.
Today on the forex market, the USD finished mixed, with gains against the NZD, AUD, and CAD and losses against the GBP, JPY, and EUR. Today, the USD was nearly unchanged against the CHF.
Today, the GBP was the strongest of the major currencies, as funds flowed out of riskier currencies. The New Zealand dollar, Australian dollar, and Canadian dollar were the weakest of the major currencies.