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ING notes that narrowing USD-EUR long-end rate differentials reflect timing issues rather than diverging economic prospects. It says hawkish ECB comments following a sizeable euro zone inflation beat could produce a short-lived rise in euro yields.
Rate differentials drive currency flows, which affect the dollar and dollar-priced commodities. The analysis is a rates outlook without a direct link to feed supply or price.
think.ing.comPadhraic Garvey, CFA, Benjamin Schroeder, Antoine BouvetSep 2, 2021After 129 past neutral macro events, EURUSD moved a median -0.1% over 5 sessions (45% higher; middle half -0.5% to +0.5%), and +0.1% over 20.
After 359 past neutral macro events, DXY moved a median -0.0% over 5 sessions (49% higher; middle half -0.4% to +0.4%), and -0.1% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
