Morning Update – 25/10/2017 – by Arjun Lakhanpal

Morning all.. Wall St had a decent day, especially the Dow which was bolstered by some impressive earnings from Caterpillar and 3M. The Dow finished up 0.72% and the S&P 0.16%. This saw the US yields rise and the 10yr move above 2.42% and the curve steepen suggesting further dollar strength.. In Asia the Nikkei was disappointing and gave up on its 16 day winning streak to close down 0.46% and this weighed on USDJPY in a small way but US yields remain above 2.42% for most of the session. Australia’s inflation, a key reading for the monetary policy outlook, rose 0.6 percent in the September quarter versus an estimated 0.8 percent from the previous quarter, while annual CPI gained 1.8 percent versus a forecast of 2 percent. The Australian dollar sunk to its lowest since July after inflation data damped the outlook for higher interest rates and traded down to .7715. More indications of broadening global growth are coming as the Federal Reserve and other central banks start to pull back on emergency monetary stimulus. The European Central Bank is expected to announce a reduction in the size of its monthly stimulus spend at its policy meeting Thursday, the biggest scheduled event for markets this week. The week ahead also boasts rate decisions from the Bank of Canada, Norges Bank and Riksbank. The kiwi extended a slide, down 0.3 percent to 68.88 U.S. cents. It’s dropped to the lowest since May amid concern economic growth will be constrained under Prime Minister-elect Jacinda Ardern. This morning we get German IFO data and UK Q3 GDP data.. Good luck..