A day after the SNB decided to abandon the peg against the Euro, the ramifications of this announcement continue to shake the markets on a global scale. In Asia, bourses closed in the negative while safe havens assets, such as the Yen and Japanese government bonds, experienced high inflows. Currently, European indices are posting mixed results as a weaker Euro and stronger Franc have different implications for businesses across the continent. However, bond yields extend their losses as yesterday’s news add more downward pressure. On the commodities side, gold, which is seen as a safe haven during times of high volatility, has increased almost 5% year-to-date, and Brent futures rallied back to $50/bbl. The rebound was due to a report by the International Energy Agency forecasting a cut in production by non-OPEC countries in the second half of 2015.
In the US markets will continue to digest the news from Switzerland while closely watching the CPI data which, is expected to disappoint due to weakness in oil and commodity prices.