Key overnight events:
- The S&P 500 Index gave up 0.9% on Friday, the biggest drop in three weeks and after the index came within 0.6% of its all-time high last week. Banks and energy companies led losses, while equity market volatility jumped the highest since January.
- The US dollar rallied, with the Bloomberg Spot Dollar Index recovering for the second day and registering a 0.6% gain. The Fed’s rate decision is due on 15th Jun, while BOJ convenes the following day.
- Sterling tumbled as much as 2.0% against the dollar after the latest UK poll conducted for Orb/Independent showed 55% want to leave the EU while 45% want to remain. The UK votes on 23rd Jun.
- WTI futures expiring in July slumped 3.0% to $49.07/bbl, trimming its fourth weekly advance out of the past five. A rising US dollar countered declining crude stockpiles and disruptions from Canada to Nigeria.
- Global bonds gained on rising demand for safer assets, with benchmark yield in Japan, UK and Germany reaching record lows.
- Spot 1.3606
- USDSGD capped the week off with a 0.5% gain on Friday, ending 0.2% higher for the week.
- The FX pair is currently being capped around its 50-day moving average at 1.3611.
- Spot 0.7374
- AUDUSD declined 0.9% to end almost unchanged for the week, around its 100-day moving average of 0.7383.
- Australia’s mining industry will cut around 50,000 jobs, mainly in Western Australia, as unwinding of the nation’s investment boom is about halfway complete, National Australia Bank Ltd said in a research note.
- Spot 1.2800
- Canada added 13,800 jobs in May, more than the 1,800 surveyed and a reversal from the 2,100 drop in April. Unemployment rate improved unexpectedly to 6.9% from 7.1%, beating the 7.2% predicted.
- The Canadian dollar weakened 0.5% against the US dollar on Friday, driven by the slump in crude oil prices, though the loonie still managed to hang on to its weekly gain, its third in a row.
- Spot 6.5963
- China onshore markets reopened Monday, following a four-day long weekend.
- Industrial production in May rose 6.0% from a year earlier, matching estimates. Retail sales over the same period gained 10.0%, a touch lower than the 10.1% expected. Foreign direct investment in yuan terms unexpectedly fell 1.0% year-on-year; a 5.0% gain was the median estimate.
- The PBOC weakened its fixing by 0.3% today. USDCNH rose to as high as 6.6115 at the open, its highest in four months, before paring gains back below the 6.6000 handle.
- Spot 8.2820
- CPI in May rose 0.3% month-on-month and 3.4% year-on-year, beating expectations of 0.1% and 3.1% respectively.
- USDNOK advanced 1.3% on Friday, reversing its weekly decline to a gain for 1.2%.