Forexlive Americas FX news wrap: Yields reverse lower, bitcoin hits record near $112K

• US May S&P Global flash services PMI 52.3 vs 50.8 expected
• US initial jobless claims 227K vs 230k estimate
• US April existing home sales 4.00m vs 4.10m expected
• Canada April producer price index -0.8% m/m vs -0.5% expected
• Fed’s Waller: If tariffs are closer to 10%, then economy is good shape for 2H
• BOC’s Macklem: G7 discussions focused on improving dialogue on tariffs
• White House: Trump believes things moving in the right direction with Iran
• US treasury auctions $18B of 10 year TIPS at high yield of 2.22%
• Freddie Mac 30-year mortgage rate for the current week highest since February
• EU’s Dombrovskis: Ministers put forth proposals on further Russian sanctions
• Fed’s Williams doesn’t comment on monetary policy or the outlook
• KC Fed manufacturing index -10 vs -5 prior
• May Belgium business confidence -13.5 vs -14.0 expected
• ECB Accounts: Increased confidence inflation would return to target over the medium term.

Markets:

• Gold down $21 to $3292
• US 10-year yields down 6 bps to 4.53%
• S&P 500 flat
• WTI crude oil down 47-cents to $61.09
• GBP leads, NZD lags

The US dollar generally strengthened in North American trade but the overall moves were modest. The bigger action was elsewhere, particularly in the bond market. US 30-year yields hit 5.16%, which is just below the 2023 high and the highest levels since 2007. However that cap held and some buyers started to weigh in from there and yields slowly fell to 5.05%.

That came in the aftermath of the US House passing a deficit-ballooning bill in Congress and sending it to the Senate. With yields declining, USD/JPY rose which is a change from the correlation for many years but underscores the change in that relationship this year. That pair ticked up to 144.31 from as 143.40 early in US trade.

US economic data argued for a solid economy as initial jobless claims were steady and the S&P Global PMIs improved, including on the pricing metrics.

Outside of FX, bitcoin and crypto were the stars of the show as BTC almost touched $112K but made a fresh record high in the fifth day of gains.

Over at the G7, there were some headlines but in general there were no signs of tension and the indication was more of a united front against China than a brewing fight with the USA.

This article was written by Adam Button at www.forexlive.com.