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.

FX news wrap May 30