Australian Dollar Outlook: AUD/USD, AUD/NZD at Key Levels as Trade Data Looms
2021-03-04 00:00:00
Thomas Westwater,
Analyst
AUD/USD, AUD/NZD, Government Bond Yields, Technical Forecast -Talking Points
Rising government bond yields spook investors as Wall Street stumbles
Australian balance of trade data in focus for Thursday’s APAC session
AUD/USD, AUD/NZD at key technical levels following AU Q4 GDP beat
US stocks moved lower as Treasury yields spiked, pushing investors into a risk-off stance with the tech-heavy Nasdaq Composite leading the move lower, closing down 2.72% on the day. The Dow Jones Industrial Average lost 0.38% while the S&P 500 closed 1.30% in the red. Small-cap stocks also suffered and the VIX volatility index climbed nearly 10%.
Average core inflation rate was 1.8 per cent in January, up from a rate of 1.5 per cent it reported last week, and materially closer to the Bank of Canada’s 2-per-cent inflation target
Bond selloff prompts stock investors to confront rising rates
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. Updated: 22 Feb 2021, 04:30 PM IST The Wall Street Journal
If yields rise more quickly and unpredictably than expected, that would be disruptive to assets like shares, many analysts say
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The sharp increase this month in U.S. government-bond yields is pressuring the stock market and forcing investors to more seriously confront the implications of rising interest rates.
The lift in yields largely reflects investor expectations of a strong economic recovery. However, the collateral damage could include higher borrowing costs for businesses, more options for investors who had seen few alternatives to stocks and less favorable valuation models for some hot technology shares, investors and analysts said.