- Hassett on tariffs: I’m sure there will be news by the end of the day
- US April ISM manufacturing 48.7 vs 48.0 expected
- US initial jobless claims 241K vs 224K expected
- April US S&P Global manufacturing PMI 50.2 vs 50.7 prelim
- Canada April S&P Global manfuacturing PMI 45.3 vs 46.3 prior
- Amazon revenues $155.7B vs expectations of $154.889B. EPS $1.59 versus $1.36 expected.
- Pres. Trump: Things moving right on schedule on tax bill
- US National Security Adviser Mike Waltz is being replaced – reports
- May forex seasonals: It’s not time to sell the US dollar just yet
- April non-farm payrolls preview by the numbers: Any signs of layoffs?
- US March construction spending -0.5% vs 0.2% estimate
- WH Eco Adviser Hassett: Hopeful for progress with China on trade
- US Treasury Secretary Bessent on the economy: We expect to see GDP revised
Markets:
- Gold down $54 to $3233
- US 10-year yields up 3.3 bps to 4.21%
- WTI crude oi up 80-cents to $0.80 to $59.02
- S&P 500 up 0.6%
- USD leads, JPY lags
US Treasury Secretary Scott Bessent touted lower two-year yields early in the day and — right on cue — they then embarked on a big reversal, rising to 3.69% from 3.55%. That turn came as the market continues to shrug off tariff fears, which was helped by an ISM manufacturing report that wasn’t as bad a feared.
With that, the US dollar held steady bids across the board and was particularly strong against USD/JPY after the BOJ refrained from hawkish talk earlier. That pair ultimately rose 250 pips before giving back about 25 late.
Other US dollar moves were much smaller as it was mostly yen selling on better risk appetite. The S&P 500 climbed for its 8th day in a row in a move that’s beginning to squeeze shorts or create FOMO. Hassett helped to fuel the moves by saying that an announcement of a trade deal was coming later today, though we continue to wait.
The oil market was lively as it was beaten up hard in early US trade before reversing. It was helped along by a Saudi denial of earlier reports that it was warning market participants that it was ready for an extended period of low prices. Brent fell to $59.30 before recovering to $61.85.
Friday is non-farm payrolls and oftentimes that restrains volatility but the thinking of most is this: If it’s strong it doesn’t really matter because it was before the tariffs. If it’s weak it could just be a one-off and much of the economy looked fine.
This article was written by Adam Button at www.forexlive.com.
