Weaker oil prices drive a bond rebound, while global forex and commodity markets diverge

⑴ Overnight market trading was muted, with a sharp increase in crude oil inventories combined with the IEA lowering its crude oil demand forecast, causing oil prices to fall by more than $1 to $82.16 per barrel, which supported a rebound in US Treasury prices; 10-year US Treasury trading remained sluggish, with the September contract fluctuating within a narrow range and only a small amount of overseas capital allocating to yield spread products in the market. ⑵ German government bond prices edged up slightly, with the yield spread between 10-year US and German Treasury bonds widening to 153 basis points. ⑶ The US Dollar Index edged down slightly to 99.87, while major non-US currencies such as the euro, pound sterling, and yen all strengthened marginally; gold prices slipped slightly to $4,386 per ounce.