OptionEye - Macro Outlook - Aug 11th
Overnight, China devalued the yuan by the most in 20 years. The Chinese central bank cut its daily reference rate by 1.9 percent, triggering the yuan’s biggest single day decline since China ended a dual-currency system back over 20 years ago.
That will make the dollar stronger and less competitive. Corn overnight gave back some gains and is down 7, beans down 10 and wheat down 5. Yesterday's rally was due to weather concerns and a crop condition report that was feared to be bad, which it wasn't. Combine that with a weaker dollar and things kind of snowballed higher with the shorts having to run for the door before tomorrow's USDA.
The 10 year yield is below 2.20% and trades at 2.17% as this Chinese move may delay a US rate hike.
The equity market is losing ground this morning after yesterday's rocket shot higher. The S & P future is off over 10 points already this morning.
Oil is lower as well and holding that $44.00 level. This morning oil is off .79 cents ot $44.17. Gold is up over $1100 to $1109.75 up $5.24.
The dollar is little changed against the measured basket of currencies to 97.19 up .03.
Today we get NIFB Small Business Optimism and Wholesale Inventories.