ForexLive Americas FX news wrap for May 23, 2016:
- PBOC minutes show no appetite for floating Chinese yuan - WSJ
- May 2016 Eurozone consumer confidence flash -7.0 vs -9.00 exp
- Fed's Williams: Brexit a factor in FOMC decision, can always hold off until July
- ECB bought €16.918bn vs €16.928bn prior in latest QE purchase count
- May flash Markit PMI 50.5 vs 51.0 expected
- Fed's Williams: 2-3 rate hikes in 2016 about right
- Fed's Williams says it's worrying that there are signs of falling CPI expectations
- JP Morgan looking for a 0.5% rate cut in UK if Leave vote prevails
Markets:
- WTI crude down 26-cents to $48.14
- Gold down $1.36 to $1250
- US 10-year yields flat at 1.83%
- S&P 500 down 2 points to 2050
- JPY leads, CAD lags
It was all about the yen today as it marched higher across the board. Yen crosses felt the heat, including USD/JPY as it sank throughout Asian, European and US trading.
The pair finishes the day 90 pips lower and has now erased the gains from the FOMC minutes and the hawkish Fed commentary last week. The strong Japanese trade surplus data sparked the initial move and a fall below 109.30 in US trading ran some stops.
The Fed's Williams offered hawkish commentary but it was generally a rehash of what he's said before and the market reaction was limited.
The Markit PMI data was soft and that was one of the reasons the US dollar sagged. EUR/USD found support near 1.1190 after weakness in Asia and then rebounded to 1.1230 before settling at 1.1215, virtually flat on the day.
Bookmakers lengthened odds further on a Brexit but GBP slumped into the London close and hit a session low at 1.4443 but it was a temporary blip and it caught the wave of USD weakness to bounce to 1.4482 later.
USD/CAD climbed up to a session high of 1.3174 early in US trading with Canada on holiday. Genscape data showed a 1m barrel draw at Cushing and that halted declines in oil and sent USD/CAD down to 1.3125 before late climb to 1.3145.
AUD/USD found its way off the mat at 0.7200 and up to 0.7220 to finish flat on the day. Stevens may shake things up with a speech later.
