The USD is mixed, but little changed vs the 3 major currency pairs to kickstart the US session .
Looking at the major pairs:
- EURUSD is down -0.16% (higher USD)
- USDJPY is also down by -0.26% (lower USD)
- GBPUSD is unchanged.
The biggest mover is the NZDUSD which has taken a tumble in the European morning session and is now down -0.59% (higher USD). The AUDUSD is down -0.20% (higher USD).
The U.S. House of Representatives narrowly passed the Tax and Spending Reconciliation Bill by a 215–214 vote, with Republicans Massie and Davidson voting against it and HFC Chair Harris abstaining by voting “Present.” Representatives Schweikert and Garbarino did not vote. The legislation now heads to various Senate committees and will eventually be debated and voted on in the full Senate—a process expected to take several weeks. If it passes, former President Trump will have his big beautiful bill, but will the markets like it?
US yields are voting and it is not supportive. On the longer end, yields moved up double digits yesterday with the yield curve steepening sharply. Looking at the treasury curve, the yield curve is steeper again with the 2-year down -2.7 basis points, while the 10 year is up 1.6 basis points. The 2-10 year spread is up to 62.5 basis points, just a few basis points from the 64.8 basis point recent high (and highest level since January 2022) reached on April 21. The snapshot shows:
- 2-year yield 3.990%, -2.7 basis points
- 5-year yield 4.142%, -1.4 basis points
- 10 year yield 4.612%, +1.6 basis points
- 30 yar yield 5.144%, +5.6 basis points
Looking at the US stock indices, the earlier pre-market gains are being eroded fast with the Nasdaq moving from about +40 points to down -92 points over just the last hour of trading
- Dow dow -221 points
- S&P down -28 points
- Nasdaq -92 points.
In other markets:
- Crude oil is down -$1.00 at $60.63. OPEC+ is discussing an increase in production for July.
- Gold is down -$5.13 or -0.14% at $3312.60
- Bitcoin is up $1000 at $110,704
The USD is little changed to start the US session. What does the recent price action say?
