According to the Danske Research Team, US yields exhibit a mixed trend and European government bond yields continue to rise, with the EUR/USD ratio hovering around 1.16. As the curve steepens, ten-year German rates have increased by around 50 basis points since early July, while US Treasury yields have increased by over 40 basis points, influencing the currency pair.
The pair's level is about 1.16.
Yields on European government bonds increased Tuesday, but the US saw a more mixed picture. Since early July, the yield on 10-year German government bonds has increased by 50 basis points, while the yield on 10-year Treasury bonds has increased by over 40 basis points. The 2-year German bond has increased by 40 basis points, and the German curve has steepened between 2 and 10 years. Additionally, the US curve has steepened by about 10 basis points.
"We anticipate that today's release of the final euro area service and composite PMIs for August will validate the flash release. Even while the flash services PMI remained at 51.7, it was still higher than anticipated. Germany led the way in Tuesday's final manufacturing PMI, which accounts for 35% of the final composite PMI.
"August's US final services PMIs are due. For the second consecutive month, August saw a significant increase in flash release, reaching its highest level since December 2024. While output charge inflation decreased to a six-month low despite persistently high input cost pressures, the details showed strong demand, growing backlogs, and tighter recruiting.
"The Challenger layoff report for August is also made public in the United States. Although layoff announcements are already low historically, they were at their lowest point in two years in July. In recent months, AI has been responsible for about one-third of layoffs.
"ADP private payrolls in the US rose by 38k in August (cons.: 48k), while the July print was revised up to 46k from 44k. Manufacturing and Professional & Business services saw declines of 17k and 16k, respectively, while Education & Health Services, Leisure & Hospitality, and Construction experienced better payroll increase than in July.
"Although ADP has historically been a poor indicator to the BLS private payrolls estimate, the publication signals to slower hiring momentum ahead of Friday's official employment report."
"Fed's Waller (voter) is scheduled to talk on the wires. Waller stated in July that the FOMC would have to think about tightening policy in the near future if core inflation was "hot".
The pair's level is about 1.16.
Yields on European government bonds increased Tuesday, but the US saw a more mixed picture. Since early July, the yield on 10-year German government bonds has increased by 50 basis points, while the yield on 10-year Treasury bonds has increased by over 40 basis points. The 2-year German bond has increased by 40 basis points, and the German curve has steepened between 2 and 10 years. Additionally, the US curve has steepened by about 10 basis points.
"We anticipate that today's release of the final euro area service and composite PMIs for August will validate the flash release. Even while the flash services PMI remained at 51.7, it was still higher than anticipated. Germany led the way in Tuesday's final manufacturing PMI, which accounts for 35% of the final composite PMI.
"August's US final services PMIs are due. For the second consecutive month, August saw a significant increase in flash release, reaching its highest level since December 2024. While output charge inflation decreased to a six-month low despite persistently high input cost pressures, the details showed strong demand, growing backlogs, and tighter recruiting.
"The Challenger layoff report for August is also made public in the United States. Although layoff announcements are already low historically, they were at their lowest point in two years in July. In recent months, AI has been responsible for about one-third of layoffs.
"ADP private payrolls in the US rose by 38k in August (cons.: 48k), while the July print was revised up to 46k from 44k. Manufacturing and Professional & Business services saw declines of 17k and 16k, respectively, while Education & Health Services, Leisure & Hospitality, and Construction experienced better payroll increase than in July.
"Although ADP has historically been a poor indicator to the BLS private payrolls estimate, the publication signals to slower hiring momentum ahead of Friday's official employment report."
"Fed's Waller (voter) is scheduled to talk on the wires. Waller stated in July that the FOMC would have to think about tightening policy in the near future if core inflation was "hot".
