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Currency Market Analysis

Jun 01, 2017 | Currency Market Analysis

Global Themes

Greenback falls as political nerves hit risk sentiment; oil tumbles

The USDSGD was broadly flat overnight commodities tumbled overnight while sharemarkets were moderately lower.

Again, it was worries about the political situation in Washington DC that sapped confidence across markets.

Most notably, commodities were lower, with crude oil down 2.7%. The Singapore dollars performance is often ties to the oil prices.

So, while the US dollar fell, the drop in oil prices saw the USDSGD broadly flat.

Safe havens

The US's political worries saw markets favour safe haven alternatives.

The Swiss franc and Japanese yen were the largest beneficiaries.

The CHFGSD was up 0.6% while the JPYSGD climbed 0.1%.

The euro was also much stronger despite a weaker than expected inflation result. The EURSGD climbed 0.4%.

Oz data

Today's focus will be on Australian data with retail sales and capital expenditure figures both due at 9:30am.

Private capex hasn’t beaten expectations in over a year while retail sales haven’t beaten expectations since October. So, weaker numbers remain a real risk.

Overnight, the US private sector employment reading, the ADP payroll report, is due at 8.15pm.

US manufacturing figures, in the form of the May PMI report, is due at 10.00pm.

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