FXStreet (Delhi) – Michael Every, Research Analyst at Rabobank, notes that the market did not so much digest the October US payrolls report on Monday as indigest it. Key Quotes “Equities were down across the board except in Japan (Nikkei +2.0% as JPY slumped) and China (Shanghai +1.6% as the market goes back on horse tranquilizers). Commodities tried to rally but also fell back as they logically should, with oil ending at USD47.2. Meanwhile, 10-year Treasury yields nudged higher to 2.34%.” “On the equity front, one has to wonder if this is just a foretaste of things to come. After all, unless we get a wild card November payrolls slump, or a re-emergence of an EM crisis, for example, then the Fed appears locked in to a December rate hike. In that case, the only course of action that equities have shown can prevent them from dreaded tighter monetary policy, with all the need to be more sensible that this entails, is to act like a toddler in the ‘terrible twos’ and throw a temper tantrum until the Fed duly steps in to calm them down again by staying on hold for longer (as in 2013, October 2014, and October this year). We shall see.” “EUR still appears steady around 1.0750, however, and has shrugged off news that Portugal’s centre-right government are set to be toppled by a coalition of left-wing parties who, like Greece’s Syriza before them, have pledged to end austerity and restructure the country’s debt.” “Given the Eurozone is still implacably committed to its gold standard status quo, are we about to see another electorate shown that Europe is a Fordist democracy as regards fiscal policy (i.e., you can have any colour you like as long as it is in the black)? The market’s vote so far has been to lift 10-year Portuguese yields to 2.91% vs. 2.3% before the 4 October election, and up another 23bp yesterday alone.” For more information, read our latest forex news.