US 10 year yields: everyone and his wife is talking about 3% cracking.
What’s more of a story though is how DXY is reacting – this started last week and today shows no sign of abating. Listen up at the back because, and you’d better be ready for this……DXY is following yields. It only took a year for the divergence to hit a bump, and erm be sort of….. converging with 10 year. Where’s that bottle of Krug when you need it ?
Not so fast.
Take a look at EURUSD still defying short term spreads. 2 yr swaps, German-US 10 yr and 2 year implied FX forward carry. Still – I think the USD party may very well start soon.
Greg Gibbs has a lovely run down on what’s what with some proper good old fashioned healthy common sense. His reports are mustard, with onions.
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