ForexLive European FX news wrap: Dollar remains soft, gold pushes up while oil slumps

Headlines:

• Gold pushes back above $3,300 on the day
• Oil struggle continues as OPEC+ moves to further boost production
• How have interest rate expectations changed after the US NFP report?
• Vietnam says first tariffs negotiation with the US to take place this week
• Switzerland April CPI 0.0% vs +0.2% y/y expected
• Eurozone May Sentix investor confidence -8.1 vs -12.5 expected
• Taiwan central bank plays down speculation after currency surge
• Taiwan central bank confirms intervening in the market today
• ECB’s Panetta: Protectionism threatens to weaken prosperity
• PBoC Governor Pan: Global economic uncertainties are rising

Markets:

• JPY leads, USD lags on the day
• European equities mixed; S&P 500 futures down 0.9%
• US 10-year yields down 2 bps to 4.300%
• Gold up 2.2% to $3,312.05
• WTI crude down 1.4% to $57.45
• Bitcoin down 1.7% to $94,111

It was a quieter session as markets will be looking to ease into the week ahead. Trade headlines continue to be the main thing to watch out for but later in the week, we’ll also have the Fed policy decision in focus. Or should I say, Trump’s reaction to the Fed keeping interest rates on hold.

The dollar is once again on the weaker side, with a surge in the Taiwanese dollar earlier in the day sparking speculation of revaluation among currencies against the greenback. Still, the dollar struggled against the majors with USD/JPY slipping back under 144.00 and EUR/USD keeping around 1.1340 currently – up 0.4% on the day.

In terms of data, we had Swiss inflation which missed on estimates. Headline annual inflation touched 0% for the first time since March 2021. And that is starting to put the focus back on deflation in Switzerland, which is likely to see negative rates return by the SNB to try and counteract that.

Besides that, there wasn’t too much else as we continue to wait on how trade talks are going between the US and the rest of the world. Coming up later this week, Vietnam will be meeting with US officials to discuss their terms. So, look out for that.

In the equities space, European indices aren’t doing all too much amid a more mixed mood. But US futures are down, though it comes after a nine-day win streak. It is arguably just a breather as it is already a rarity to see nine straight days of gains, let alone ten.

In other markets, gold is once again lighting up in a push above $3,300 while oil is pressured as OPEC+ seeks to boost output further and that saw prices open with a gap down by over 3% earlier before paring some of that losses.

This article was written by Justin Low at www.forexlive.com.