Early Pressure To Safe Havens Eases, Oil-Tied FX Struggle

Decent start for the stock markets applied some light pressure to safe haven currencies, but it has dissipated as two of the U.S. e-minis as well as equity benchmarks in Japan, Australia & South Korea have turned red. Likely limiting factors included a heavy start to the week for crude oil, close proximity to all-time highs in e-minis & the potential for sizeable month-end re-balancing flows. JPY has regained poise, leaving USD at the bottom of the G10 pile, with the DXY crossing below its worst levels since 2018. CHF has remained buoyant from the off after Swiss voters rejected two proposals to make multinational companies liable for human rights/environmental abuses committed abroad & ban funding of weapons producers.

• Oil-tied CAD & NOK have been weighed on by the aforementioned losses in crude prices. The Antipodeans have held up well, with AUD/USD peeking above the $0.7400 mark and narrowing in on the cycle high of $0.7414.
• GBP started the week on a slightly firmer footing, as participants welcomed suggestions that a Brexit deal could be struck as soon as this week, even as fishing rights remain a key sticking point.
• The yuan has shown a muted reaction to above-forecast official PMI data released out of China. The M'fing gauge indicated that the expansion in the sector reached the highest pace since Sep 2017.
• Today's data highlights include U.S. MNI Chicago PMI, flash German & Italian CPIs, Canadian building permits & current a/c balance. Central bank speaker slate features ECB's Lagarde, Fed's Barkin & BoE's Tenreyro.