North American Summary and Highlights 28 May

North American session

The USD more than fully reversed European losses in the North American morning, EUR/USD falling below 1.13 and USD/JPY reaching 145. EUR/GBP also reversed European gains while EUR/CHF was weaker near .9340. AUD/USD saw only modest losses and a rise in USD/CAD was reversed.  

UST yields moved higher ahead of FOMC minutes from May 7, which produced few surprises, with the FOMC in agreement to hold policy steady until greater clarity was seen. UST yields moved off their highs but there was little response from equities or FX.   

European morning session 

The USD was softer in a quiet European morning session. EUR/USD gained 25 pips to 1.1335, and USD/JPY lost 15 pips to 144.15. The riskier currencies broadly kept pace with the EUR while the CHF moved in line with the JPY.  

There were several second-tier data releases, none of which had market impact. German unemployment data showed a larger than expected 34k rise in May, while French Q1 GDP was unrevised at 0.1% q/q, although the y/y rate was revised down to 0.6% from 0.8%. French consumer spending was weaker than expected at 0.3% in April after a 1.1% decline in March. Swedish retail sales were on the strong side of consensus at 5.3% y/y in April, while German import prices fell a larger than expected 1.7% in April.