News

We keep getting thrown off, and the lack of predictability is driving investors elsewhere.

US Treasury Secretary Scott Bessent said on Sunday that US President Donald Trump and Chinese President Xi Jinping are likely to speak soon to iron out trade issues including a dispute over critical minerals, per Reuters. 

The AUD/USD pair extends its upside to around 0.6445 during the early Asian session on Monday. Tariff uncertainty continues to undermine the US Dollar (USD) against the Australian Dollar (AUD).

China’s official Manufacturing Purchasing Managers’ Index (PMI) rose to 49.5 in May, compared to 49.0 in the previous reading. The reading came in line with the market consensus in the reported month. 

OPEC+ has agreed to raise oil production by 411,000 barrels per day in July, matching the increases already set for May and June. The decision marks a continuation of the group’s recent strategy shift aimed at reclaiming market share and pressuring members who have been exceeding their output quotas.

According to Reuters, eight members are now rolling back a total of 2.2 million barrels per day in voluntary cuts made on top of existing reductions.

While Saturday’s agreement, led by Saudi Arabia during a video meeting, reflects a break from OPEC+’s long-standing efforts to prop up oil prices, oil has opened higher, Brent back circa USD64.

Its still not too far above a four-year low.

This article was written by Eamonn Sheridan at www.forexlive.com.

Angel Zheng’s latest endeavor may serve as the highest expression yet of her ikigai — “a passion that gives value and joy to life.”

Speech by Governor Waller on the economic outlook, full text here:

• The Effects of Tariffs on the Three I’s: Inflation, Inflation Persistence, and Inflation Expectations

• ‘Good news’ rate cuts remain possible later this year
• Rate cut view rests on easing inflation, tariffs on lower end of range
• Strong economy through April gives Fed time to see how trade shakes out
• Tariffs likely to create one-time price increase Fed can look through
• Considerable uncertainty still surrounds trade policy outlook
• Sees downside risk to economy, job market, upside risk to inflation
• Tariffs to be main driver of inflation this year
• Tariffs will drive up unemployment which will likely linger
• Tariff inflation impact likely greatest in second half of 2025
• 01 Jun 2025 08:00:00 PM – Fed’s Waller says he is most attentive to market and forecaster views on inflation
• Doesn’t see real world issues with expected path of inflation
• Some of modest sized tariff regime will not be passed along

This article was written by Eamonn Sheridan at www.forexlive.com.

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The Organization of the Petroleum Exporting Countries and its allies (OPEC+) agreed to surge oil output for the third month in a row. An increase in oil output for July that may be larger than the 411,000 barrels per day (bpd) increases it made for May and June, per Reuters. 

Japan Capital Spending Q1 3025 +6.4% y/y

• expected +3.8%, prior –0.2%
• for the q/q +1.6%

Capital Spending Ex Software +6.9% y/y

• expected +5.3%, prior +3.1%

Company Sales +4.3% y/y

• expected +3.0%, prior +2.5%

Company Profits +3.8% y/y

• expected +6.0%, prior +13.5%

A bit of a mixed bag of results here. Profits not rising as much as expected and well below Q4 2024.

USD/JPY not a lot moved:

This article was written by Eamonn Sheridan at www.forexlive.com.