Week Ahead: US Inflation In Focus As Energy Fears Cool
XM Group | Oct 08, 2021 06:54AM ET
Give me shelter
The US dollar has reclaimed its throne as king of the FX arena, slicing through its rivals as investors looked for shelter from the storm in equity and energy markets. From paralyzed supply chains to an energy crisis that threatens to cripple Europe and Asia, there’s a real risk that global growth slows but inflation remains hot.
And with bond yields rising everywhere because of inflation concerns, the dollar is almost the last defensive hedge left across all asset classes. Neither bonds nor gold nor the yen are attractive in an environment of rising yields.
Finally in Australia, the jobs report for September is out on Thursday and expectations are for another round of sharp losses in employment, reflecting the recent lockdowns. That said, markets already know this was a tough month, so the aussie is more likely to be driven by the outlook for global growth, the energy crisis, and how the Chinese economy performs.
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