DXY on the front foot as China warn of........>

FOREX: DXY on the front foot as China warn of sanctions countermeasures

- After global PMI data painted an expectedly dire picture of economic activity

across May, focus turned to weekly US jobless claims/continuing claims numbers,

which fared poorer-than-expected. The greenback soon recovered, however, as

markets eyed a press conference from China's NPC that warned China would take

countermeasures against any US sanctions.

- HKD was also a focus following clarification from China's NPC that China are

to press forward with a bill on Hong Kong security. The legislation would

further restrict "secession, sedition, foreign interference and terrorism". Spot

HKD weakened, but the more notable move was in forward and swap markets, with

forward points across the curve rising sharply - 12m forward points hit their

highest level since early 2016.

- Friday focus turns to Japanese inflation data and the unscheduled policy

meeting from the Bank of Japan. The BoJ are seen keeping policy unchanged but

providing more information on funding for business. UK and Canadian retail sales

data also crosses. ECB's Lane speaks.