Sunset Market Commentary

Yesterday’s ‘hawkish’ Fed dots raising governors’ 2024/25 inflation projections, a higher reference for the neutral rate (2.75% ) and indicating only one rate cut this year as the FOMC’s preferred interest rate scenario only limited the big decline in US yields post a softer than expected US may CPI release.

Bank of Japan (BoJ) Preview: Potential Cut in Bond Buying to Aid Ailing Yen?

The Japanese continued its slide this morning as USD/JPY edged higher toward the 160.00 psychological level. A brief respite yesterday for USD/JPY which was somewhat of a surprise given the outcome of the Federal Reserve (FOMC) meeting. The Fed left its benchmark lending rate steady in the range of 5.25%-5.50% while delivering a somewhat hawkish update to the summary of economic projections (dot plot).

USD/JPY Nearing April JPY-Intervention Levels in Wake of BoJ

USD/JPY finished only slightly higher yesterday as both a strong US dollar and JPY against the risk-off background kept each other in check. That changed this morning though with the pair nearing the April JPY-intervention levels in the wake of the BoJ policy meeting (cfr. infra).

Crypto Bears in Charge

Crypto market capitalisation fell 0.5% to $2.44 trillion as Thursday’s growth attempt failed to gain traction due to a new wave of dollar strength. Risk demand is gradually diminishing, forming a sequence of declining intraday highs. However, horizontal support remains in the 2.42 trillion area, where the market also stabilised from May 17th to 20th.

NZ Dollar Slips on Soft Manufacturing Data

The New Zealand dollar is sharply lower on Friday. NZD/USD is down 0.61%, trading at 0.6130 in the European session at the time of writing.

German DAX: Torpedoed by Rising Geopolitical Risk Premium in Eurozone

The price actions of the Germany DAX CFD Index have staged a daily close below its 50-day moving average and the lower boundary of its medium-term ascending channel from the 18 January 2024 low.

Sunset Market Commentary

Outright risk-off from the start of trading today. French President Macron’s parliamentary election bet culminated in the current risk climate. The French president’s approval rating hit an air pocket and his Renaissance party is burnt. Nobody, stretching from left to right on the political aisle wants to join forces with the stigmatized French president going into the elections.

Euro Shrugs as ECB Lowers Rates to 3.75%

The euro is drifting on Friday. EUR/USD is trading at 1.0892 in the European session, up 0.04% on the day. We could see some movement from the euro in the North American session, with the release of US nonfarm payrolls.

Canadian Dollar Eyes Can., US Job Data

The Canadian dollar has had a relatively quiet week and has ticked higher on Friday. In the European session, USD/CAD is trading at 1.3683, up 0.10%. We could see stronger movement from the pair in the North American session, when both the US and Canada release the May employment report.

Crypto Market Quiet

The crypto market capitalisation remained almost unchanged overnight at $2.63 trillion, showing a sharp decline in volatility. Bitcoin settled near the $71K level (+0.2%), while Ethereum settled near $3800 (-0.9 %). Prices of top altcoins changed between -1.2 % (Avalanche) and +2.7% (Toncoin).