Stocks and bonds trading at historically high valuations is seeing a steady push of capital into the higher risk premium ends of the market.
After surging higher off the comments from the Fed’s Stanley Fischer, the DXY US dollar rally entirely reversed overnight pulling back to almost exactly where it started the session. And a similar pattern was seen in most of the major USD crosses. The Aussie dollar edged up slightly higher by 0.1% to US$0.7632 after dropping to US$0.7584 at one point in overnight trade. US treasuries had even more conviction, totally discounting the threat of an imminent rate rise and continuing to rally with 30-year yields dropping by 4.9 basis points and the TLT iShares 20+ Year ETF gained 0.8%.