US May S&P Global flash services PMI 52.3 vs 50.8 expectedUS initial jobless claims 227K vs 230k estimateUS April existing home sales 4.00m vs 4.10m expectedCanada April producer price index -0.8% m/m vs -0.5% expectedFed’s Waller: If tariffs are closer to 10%, then economy is good shape for 2HBOC’s Macklem: G7 discussions focused on improving dialogue on tariffsWhite House: Trump believes things moving in the right direction with IranUS treasury auctions $18B of 10 year TIPS at high yield of 2.22%Freddie Mac 30-year mortgage rate for the current week highest since FebruaryEU’s Dombrovskis: Ministers put forth proposals on further Russian sanctionsFed’s Williams doesn’t comment on monetary policy or the outlookKC Fed manufacturing index -10 vs -5 priorMay Belgium business confidence -13.5 vs -14.0 expectedECB Accounts: Increased confidence inflation would return to target over the medium term.
Markets:
Gold down $21 to $3292US 10-year yields down 6 bps to 4.53%S&P 500 flatWTI crude oil down 47-cents to $61.09GBP leads, NZD lags
The US dollar generally strengthened in North American trade but the overall moves were modest. The bigger action was elsewhere, particularly in the bond market. US 30-year yields hit 5.16%, which is just below the 2023 high and the highest levels since 2007. However that cap held and some buyers started to weigh in from there and yields slowly fell to 5.05%.
That came in the aftermath of the US House passing a deficit-ballooning bill in Congress and sending it to the Senate. With yields declining, USD/JPY rose which is a change from the correlation for many years but underscores the change in that relationship this year. That pair ticked up to 144.31 from as 143.40 early in US trade.
US economic data argued for a solid economy as initial jobless claims were steady and the S&P Global PMIs improved, including on the pricing metrics.
Outside of FX, bitcoin and crypto were the stars of the show as BTC almost touched $112K but made a fresh record high in the fifth day of gains.
Over at the G7, there were some headlines but in general there were no signs of tension and the indication was more of a united front against China than a brewing fight with the USA.
This article was written by Adam Button at www.forexlive.com.