The US$ is mixed again on Friday, lower against the EU majors while firm against the Jpy and the commodity bloc currencies. The dollar was partly undermined by the story that US Secretary of State Rex Tillerson will be replaced by Mike Pompeo around the end of the year. The big story of the day though was in stocks, which again soared higher on strong indications that Donald Trump’s tax-cut plan may get enough support to pass through the Senate, with Republican Senator John McCain saying he would back the tax bill, adding it would boost the economy and provide tax relief for all Americans. WTI is a little lower, despite OPEC and non-OPEC producers, led by Russia, agreeing to extend oil output cuts until the end of 2018, while the metals have also headed lower. Note that US yields jumped higher today, breaking above 2.4% in the 10 Year Treasuries and should underpin the dollar if we see further gains.
Friday will kick off with a busy Asian session, featuring the Japan CPI (exp 0.2% – Oct), Unemployment (exp2.8%), Q3 Capital Spending (exp 3.3%) and the Nikkei Mfg PMI the Caixin China Manufacturing PMI and the RBA Commodity Index. Europe will look to the Manufacturing PMIs for guidance, as will the US, with the ISM Mfg PMI/Prices paid also to be released. Fed speakers on Friday will include Bullard, Kaplan and Harker.
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|ASX SPI: 6003|