2 Min Market Summary: 24 May 2019

CURRENCY MARKET WRAP 

As of Fri, May 24, Singapore Time zone UTC+8

Dollar Index -0.20%, 97.84
USDJPY, -0.62, $109.56        
EURUSD, +0.25%, $1.1184        
GBPUSD, -0.01%, $1.2664
USDCAD, +0.33%, $1.3475
AUDUSD, +0.30%, $0.6899
NZDUSD, +0.40%, $0.6521

Manufacturing PMIs were both weak for the E.U. and U.S. E.U. Flash Manufacturing PMI at 47.4 vs expected 48.2. U.S. Flash Manufacturing PMI at 50.6 vs 53.0.

In Trade, President Xi warned about a “new long March and “self-reliance,” there will be no quick solutions. By evoking a term that relates to Mao Zedong’s strategic retreat in 1934, China is saying they will not back down easily and are prepared to make the sacrifices needed to preserve their industries for the years ahead. If China refuses to cooperate, Trump could push for new tariffs on USD$300B of Chinese goods. More companies outside the U.S. reportedly began cutting ties with China’s Huawei Technologies. The persisting uncertainty in the outcome, and duration, of the U.S.-China trade dispute fed into concerns about economic growth and corporate earnings prospects. In turn, fears of weakening demand for oil contributed to the 5.8% drop in WTI crude ($57.83/bbl, -$3.57).

Defensive positioning in U.S. Treasuries sent the 2-yr yield down 11 basis points to 2.11% and the 10-yr yield down ten basis points to 2.30%. This was the lowest level in the 10-yr yield since late 2017. The U.S. Dollar Index declined 0.2% to 97.84.