Growth concerns drive yields sharply lower

Yields -Continue to slide on economic concerns

Brexit – May offers resignation in exchange for Brexit deal

EM currencies – Turkey measures have investors selling other EM currencies

Oil – Crude stockpiles rise

Gold – Slides on profit-taking

Bitcoin – Rises as volatility eases


Right now, bonds are driving the move with all asset classes.  The concerns for the global growth are driving the flight to safety and bonds and safe-haven currencies are in demand.  The yield on 10-year Treasuries fell to the lowest level since December 2017.  Today, we saw a wrath of dovish talk from ECB and Fed speakers.  Draghi and Praet reiterated accommodative stances are needed, while the Fed’s Kaplan noted that we would need to see a more pronounced yield curve inversion to consider a rate cut.

The key spread between the 10-year and 2-year Treasuries widened to 17.1 basis points, seven points wider than last Friday’s low of 9.9 basis points.  The yield curve is still inverted for the 3-month/10-year yield spread.  Global growth concerns will remain the key driver for risk aversion, but we could see that ease up if US-China trade talks deliver another positive step in the right direction.


Its due or die time for PM May.  She is going all in on her Brexit strategy and she is offering her resignation if she can get Tory support to push her deal through Parliament.  Cable rose after reports that Boris Johnson and Iain Duncan Smith would support her deal.

It seems the choice is either May’s deal or a long extension.  Either way, we will likely be seeing less of the PM in the near future.  Several outcomes still exist on how Brexit will unfold, but tomorrow’s motions may provide further clarity on how we get there.

Emerging Market Currencies

The Turkish government is trying to stave off a currency crisis and preventing investors from selling the lira is likely to do more harm in the long run.  Unable to properly hedge their positions, traders ended up shorting other emerging market currencies, such as the South African rand, Brazilian real and the South African rand.  President Erdogan has not delivered an economic turnaround since the last year’s election and he could see his government lose many seats in local elections.  The decision to restrict foreign banks to getting access to the lira until the elections are over will scare off investors going forward.


Crude’s recent rally was disrupted after the weekly EIA inventory data showed a strong rise with stockpiles.  Today’s fall does not derail the short-term bullish argument that both the OPEC + production cuts and supply outages will outweigh the global growth concerns and rising US production.  The month of May will be a critical moment for oil prices as the US will have to decide if they will continue waiving sanctions on Iranian crude.  If we see West Texas Intermediate crude closer to $70 a barrel, the decision to hold off coming down on Iran will be an easy one.


Profit-taking and expectations for a stronger dollar kept the yellow metal from resuming its bullish trend.  Gold failed to turn positive despite a wrath of dovish bets that the Fed may target more than a 25-basis point cut by the end of the year and further measures from the ECB that might alleviate the edge off its negative rate policy.  Gold typically benefits when we see accommodative stances by the major central banks and if we do see global yields stabilize, we could that be supportive for higher commodity prices.


Bitcoin recaptured the $4,000 level as volatility is poised to ease to the least volatile month on record.  The digital currency has been battered over the past year and saw over $400 billion in market cap disappear.  Price is approaching the upper boundaries of the recent range that has been in place for this year, but if volatility remains steady, we could see prices grind on higher.  With falling demand for the adoption of digital assets, we would likely see the cryptocurrency struggle to make a move above the $5,000 level.

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at Visit to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.

Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023.

His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.

Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with, where he provided market analysis on economic data and corporate news.

Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal.

Ed holds a BA in Economics from Rutgers University.