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Daily Pivots: (S1) 0.8182; (P) 0.8265; (R1) 0.8312; More…. Range trading continues in USD/CHF and intraday bias stays neutral. On the downside, break of 0.8187 will resume the fall from 0.8475 to retest 0.8038 low. On the upside, above 0.8346 will bring stronger rise to 0.8475. Firm break there will extend the corrective pattern from […]
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This is a low tier indicator and also quite lagging, therefore never a market moving release.
This article was written by Giuseppe Dellamotta at www.forexlive.com.
BoE’s Taylor in the Financial Times, info via Reuters headlines:
That last point, Taylor is playing down inflation pressures, one off factors only. If he is correct it leaves scope for further BoE cuts as inflation pulls back.
This article was written by Eamonn Sheridan at www.forexlive.com.
Bessent says US-China talks ‘stalled,’ pushes for Trump-Xi call
US Treasury Secretary Scott Bessent said trade talks with China are “a bit stalled” and suggested that a call between President Donald Trump and Chinese President Xi Jinping may be needed to break the impasse. In an interview Thursday, Bessent emphasised the importance of direct leader-level engagement given the scope and complexity of the negotiations. He recently visited Switzerland for discussions that helped both sides step back from imposing over 100% tariffs on each other’s goods, and he expects more talks with Chinese officials in the coming weeks.
Bessent’s ‘stalled’ remark lent a bid to the yne, USD/JPY dribbled lower to circa 143.80. It fell further a little later on the CPI data.
Tokyo inflation surprises to the upside
Tokyo’s CPI data for May showed both core and core-core inflation exceeding expectations:
Core CPI (excluding fresh food) rose 3.6% y/y (vs. 3.5% expected), up from 3.4% in April — the highest since January 2023.
Core-core CPI (ex. fresh food and energy) increased to 3.3% y/y (vs. 3.2% expected), its highest since January 2024.
Headline CPI held steady at 3.4% y/y.
The core-core reading — closely watched by the Bank of Japan — remains well above the 2% target, strengthening the case for further policy adjustment. JPY caught a small bid on the data, with USD/JPY dropping to as low as 143.50 before bouncing back toward 144.00.
Japan also held a 2-year JGB auction during the session, with a bid-to-cover ratio of 3.77 (prev. 3.58). The average yield was 0.752% (prev. 0.691%).
Fedspeak
San Francisco Fed President Mary Daly reiterated that policy is in a “good place.” She expects inflation to moderate and sees room for two rate cuts in 2025 but noted businesses are still assessing the impact of Trump’s policies: “As they wait to see, we wait to see.”
Dallas Fed President Lorie Logan echoed similar sentiments, noting the labour market remains strong and inflation is gradually trending toward target. She said risks to the Fed’s policy goals are “more or less balanced.” Logan did =not give guidance on expected rate cuts like Daly did.
Australia very weak retail sales
Australia’s April retail sales were surprisingly weak:
-0.1% m/m (vs. +0.3% expected)
The softness comes despite a boost from the Easter/Anzac holiday period and Queensland’s rebound from Cyclone Alfred. The data suggests consumers remain cautious, supporting the case for further RBA rate cuts.
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The USD ticked modestly higher across the majors. JPY outperformed on stronger inflation data, while AUD slipped on weak domestic retail sales.
This article was written by Eamonn Sheridan at www.forexlive.com.
Daly spoke earlier in the timezone here:
This article was written by Eamonn Sheridan at www.forexlive.com.
