- US to reign in AI chip sales to Middle East by Nvidia and AMD
- US initial jobless claims 219K vs. 218K estimate
- US April advanced goods trade balance -$99.4 versus -$91.8B expected
- US Q1 GDP (second reading) +1.3% vs +1.3% expected
- US pending home sales for April -7.7% versus -0.6% expected
- US wholesale inventories (preliminary) for April 0.2% versus 0.0% estimate
- Canada Q1 current account -5.37B vs -5.50B expected
- Fed's Williams: Fed policy positioned well to get inflation back to 2%
- Fed's Williams: We have time and space to take in data before shifting on policy
- More Williams: monetary policy is clearly working how Fed wants it to work
- Fed's Bostic: I don't see a rate cut in July but I am open if data justifies
- Fed's Goolsbee: Issue now is trade off beween inflation and unemployment
- OPEC+ discusses keeping voluntary cuts until year end - report
- EIA weekly US oil inventories -4156K vs -1950K expected
- Canadian small-business optimism jumps in May
- Preview: What to look for in the April US PCE inflation report
- Former NY Fed Pres Dudley: The FOMC isn’t doing enough to fight inflation
Markets:
- Gold up $3 to $2341
- WTI crude oil down $1.34 to $77.89
- US 10-year yields down 7.6 bps to 4.55%
- S&P 500 down 0.6%
- CHF leads, USD lags
Thursday was a reversal in the price action from earlier in the week as Treasury yields fell and dragged down the US dollar. There wasn't a clear catalyst as the data was mixed but there was a downtick in inflation in the GDP report, a weak trade number and a sharp drop in pending home sales. That may have given the market some comfort that the economy isn't re-accelerating. In addition, some retailers reported soft numbers with others highlighting Q2 challenges.
Dollar selling was steady for most of the day with the euro climbing to 1.0845 from 1.0790 but offers at 1.0850 held and late in the day there was some angst in equities on the NVDA report. That led to some small USD safe-haven bids.
Unlike the US usual risk trade, the moves today were more about the dollar as the yen and Swiss franc made progress. The SNB was more hawkish, helping to lift the swissy while the yen may have benefitted from position squaring ahead of today's Japanese data slate and tomorrow's US PCE report.
The commodity currencies erased yesterday's declines despite falling oil prices. Crude is something of a mystery this week as it jumped to start the week on no news then fell today despite a report that OPEC could keep cuts in place through year end.
