Today was a tough day in the markets, with stocks, bonds, commodities, and precious metals all taking a hit. The only exception was bitcoin, which saw a 5% gain amidst the chaos. This market turmoil was triggered by political and economic uncertainty, leading to a ‘Sell Everything’ day as investors looked to de-leverage and cash out after a strong stock market rally this year.
While other sectors saw significant declines, the foreign exchange market saw more modest movements. The US dollar’s weakness persisted, with the euro and pound both retreating from key levels. USD/JPY managed to hold steady despite the market volatility, supported by rising yields and speculation about the Bank of Japan’s next moves.
Commodity currencies, on the other hand, faced significant pressure as growth prospects dimmed both domestically and globally. A disappointing retail sales report in Canada has increased expectations of an interest rate cut next week and raised the possibility of a more aggressive rate-cutting cycle.
Looking ahead, there are hopes for announcements from China’s Third Plenum meeting and potential policy changes that could impact global markets. Despite the challenging conditions, there is optimism that central banks will continue to focus on controlling inflation and stabilizing the markets.
As we head into the weekend, it’s clear that the market volatility is far from over. Investors will be watching closely for any developments that could provide some much-needed stability and direction in the coming weeks.