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- China court bans Micron sales
- PBOC official says China won't use yuan as a tool in trade conflict
- Lopez-Obrador: The government NAFTA team will remain the same
- ECBs Villeroy says Euro area must be strengthened
- ECB's Praet: Progress towards a sustained adjustment in inflation has been substantial
- Theresa May gunning for "softest possible Brexit" - report
- New Zealand GDT price index -5.0%
- US May factory orders +0.4% vs 0.0% expected
- Canada June Markit manufacturing PMI 57.1 vs 56.2 prior
- Saudi cabinet says affirms readiness to use spare oil capacity if needed
- Trump maintains that conversations with North Korea are "going well"
Markets:
- AUD leads, USD lags
- Gold up $11 to $125
- US 10-year yields down 4 bps to 2.83%
- WTI crude up 19-cents to $74.13
- S&P 500 down 13 points to 2713
Trade war headlines continued to dominate. The early tone was positive after the yuan reversed gains and the PBOC said the currency wouldn't be used in any trade disputes. That contributed to a reversal of most of Monday's US dollar strength.
The tide turned on the Micron headlines that came in the final hour of US equity trading, which was shortened because of the July 4 holiday. Equities had been comfortably higher, then slumped led by tech. That pulled USD/JPY down to 110.58 from a high of 111.14 and it skidded sideways late as the US departed and the England match got underway.
Oil was a big mover as it dropped to $72.73 from $75.27 in the span of 90 minutes and for no clear reason. There was all the usual after-the-fact reasoning, including a production restart in Alberta but nothing added up. In any case, crude bounced back to $74.16.
USD/CAD was taken along for the ride as it rose up to $1.3175 from 1.3140 but then slowly sank down to finish near the lows.
Cable climbed late in the day up to 1.3200 from 1.3160 in large part due to a report that Theresa May is seeking a very soft Brexit.
EUR/USD chopped in the 1.1650 to 1.1670 range throughout the day, waiting on German government headlines.
The Mexican peso rose more than 2% as the market likes what it hears from AMLO.
