RBC Capital Markets

Day ahead: US Q1 GDP is expected to be revised only marginally higher and April durable goods orders should show solid gains. Otherwise the data calendar is light today. Central bank speakers include several from the ECB plus the BoE’s Vlieghe and Riksbank’s Skingsley.

Month‐end: There may be some early focus on month‐end flow in the next couple of sessions, given Monday’s UK and US public holidays. Currently, however, our models’ signals are all neutral as US equity prices have barely changed through May in net terms.

JPY: USD/JPY has been in less than a 150 point range for the whole of May so far – the tightest monthly range since December 2019 and with the exception of that month, the tightest monthly range (in points terms) for 45 years (see yesterday’s Chart of the Day). Labour market data are due tonight, but will have little bearing on USD/JPY which is largely taking its cues from US yields.

Citi

It was a rangebound session in Asia, with some of the renewed strength in equities and pressure in the USD taking pause. The FOMC debate remains lively, but investors will have to wait until next week’s NFP for a more meaningful catalyst. US cap goods and a secondary estimate for Q1 PCE today are unlikely to do the trick. In the meantime, we think that month end and positioning adjustment is likely to dominate this week’s market dynamics, with the recent weight rebalancing of MSCI taking effect today and impacting Asia equities.

While EURUSD has failed to follow through to the topside, note that Wednesday’s standout performers have held onto gains. NZDUSD is holding onto gains just below a significant resistance range while USDCNH trades at the 6.38 handle. Headlines from the phone call between US and China trade representatives produced no headline risk. The BoK left rates unchanged, though there were decent forecast upgrades for KRW which continues to follow broader USD/EM sentiment.