Key overnight events:

  • The S&P 500 Index closed 0.2% lower after ending near the lows of its session amid weakest volumes in almost 2 months. The US benchmark has gone more than a year since reaching its last record as the 7-year bull market continues to lose steam amid concern economic stimulus is fading. Defensive stocks such as utilities and telecommunication stocks led declines.
  • The US dollar continued to trade near an almost 2-month high as speculation continues to mount that the US may raise rates as soon as next month. The Bloomberg Spot Dollar Index ended almost unchanged for the session, but climbed 0.1% in early Asian trading hours today.
  • The Fed’s St Louis President James Bullard, who is a voter in this year’s committee, said he doesn’t see “Brexit” affecting the FOMC’s June meeting. Separately, San Francisco Fed’s John Williams, who is a non-voter, commented that 2-3 hikes this year are “about right”.
  • WTI futures expiring in July slipped 0.7% to settle at $48.08/bbl, as cooler weather helped control a blaze in the heart of Canada’s oil-sands region. Elsewhere, exports from Iran could surpass 2.2 million bpd by midsummer, the state oil company told the Mehr news agency.
  • The PBOC said its key mission is to maintain yuan stability rather than let the market weaken it, according to a Wall Street Journal report of unreleased March minutes, which suggests the central bank has abandoned its August pledge to let yuan move more freely.
  • Switzerland will vote on 5th Jun to decide whether the government should introduce an unconditional basic income to replace welfare benefits. A sum of 2,500 francs for an adult and a quarter of that for a child have been suggested. The basic income initiative is taking place after the proposal gathered 100,000 signatures, though current polls suggest it won’t get any further.



  • Spot 1.3816
  • Following a 2.8%-rise for the month, USDSGD has paused for a breather, holding around the 1.3800 handle over the past 2 days.
  • UOB expects core inflation to average 1.0% in 2016, as disinflationary effects of oil from 2015 starts to ease more towards the second half of the year, according to the a 23rd May note. The bank expects no further easing in October and maintains a year-end forecast of 1.3600 for USDSGD.
  • Vacancies in the main Orchard Road area, a magnet for tourists lured by malls and department stores, have risen to a 5-year high.



  • Spot 0.7214
  • AUDUSD has closed below its 200-day moving average of 0.7255 for the past 3 consecutive days.
  • The currency pair continues to be supported at the 0.7200 handle, but a move down towards 0.7000 looks probable as further weakness to iron ore is expected following yesterday’s 6.7% slide.



  • Spot 1.3168
  • USDCAD climbed 0.1% to 1.3174, eking out a fresh high before paring gains later on.
  • The Bank of Canada is due to release its rate decision tomorrow night. The current benchmark rate is 0.50% and no change is expected.



  • Spot 6.5648
  • Following reports in WSJ that the PBOC has dropped its market-based mechanism to determine its exchange rate and instead valuing stability as its primary priority, the onshore yuan remained the only Asian currency to advance today against the US dollar.
  • USDCNH was slightly lower and reached a session low of 6.5605 earlier today.



  • Spot 8.3708
  • USDNOK climbed 0.4% to a session high of 8.3838 last night. Gains were driven by a stronger US dollar and weaker oil prices.
  • The currency pair continues to remain capped below its 50-week moving average of 8.3868.


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UEN: 201419754M

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