Entering into US session, Swiss Franc and Yen are running as the strongest ones for today. US-China trade war is again the main theme. There are reports that China is weaponizing its dominance on rare earths. Some claimed that might risk serious disruption to US industries. We’re skeptical on the impact of such move. And, the reactions from stocks are relatively mild too, considering DOW future is just down -167pts for the moment. Nevertheless, the message is reinforced. That is, China is not going to back down and rectify its own unfair practices. And the maximum pressure way of Trump is useless. Trade war is not as easy to as it seems to some people and it’s going to drag on longer.
Staying in the currency markets, for now, Dollar is following as the third strongest for the day shrugging off persistent decline in treasury yields. 10-year yield is currently down -0.0368 at 2.228, and could hit 2.2 handle pretty soon. New Zealand Dollar is the weakest one for today s far, followed by Sterling. Canadian Dollar is a the third weakest as markets await BoC rate decision. Euro is mixed while markets await European Commission’s formal warning letter to Italy for its deficit.
Some previews on BoC:
- BOC to Avoid Hinting Rate Hike Despite Improvement in Economic Data
- Will the BoC Strike a More Confident Tone at its May Meeting?
- Forward Guidance: International Trade Tensions Unlikely to Sway the Bank of Canada Rate Decision
In Europe, currently:
- FTSE is down -1.31%.
- DAX is down -1.34%.
- CAC is down -1.79%.
- German 10-year yield si down -0.0075 at -0.165.
Earlier in Asia:
- Nikkei dropped -1.21%.
- Hong Kong HSI dropped -0.57%.
- China Shanghai SSE rose 0.16%.
- Singapore Strait Times dropped -0.06%.
- Japan 10-year JGB yield dropped -0.0229 to -0.094.
