Sterling Surges After Super Thursday Elections, Yen Loses Ground

Sterling caught a bid and led gains among the G10 pack as BBG trader sources cited interbank buying by Japanese bank, which squeezed weak short-stops in cable, while participants scrutinised the results of the UK's "Super Thursday" elections. The Tories made further inroads into traditional Labour strongholds, while Labour's Khan was re-elected as London Mayor by a slimmer margin than expected. Elsewhere, the SNP fell one seat short of an outright majority in Scotland's devolved parliament. Some may interpreted the SNP's sub-50% result as a positive, even as the party is expected to team up with pro-independence Greens in launching another bid to separate Scotland from the rest of the UK. Cable rallied to levels not seen since Feb 25.

• The yen went offered across the board amid a decent showing from regional equity benchmarks (ex-China), with e-minis printing fresh record highs. Local Covid-19 situation remained a source of worry, with questions re: implications for the Tokyo Olympics doing the rounds. USD/JPY roughly halved Friday's post-NFP losses.
• USD/CNH firmed a tad, with a weaker than expected PBOC fix helping keep the rate afloat. China's central bank set their USD/CNY mid-point at CNY6.4425, 55 pips above sell-side estimates, in a sign that officials are willing to reign in redback appreciation. The fixing came after post-NFP dollar sales took USD/CNH close to its three-year lows on Friday.
• Early trade saw commodity-tied FX draw some support from supply concerns linked to Friday's cyberattack on a critical U.S. fuel pipeline network. The initial impetus seemingly faded away as crude oil, gasoline & heating oil pulled back from their respective highs.
• Norwegian CPI, Rinksbank Apr MonPol meeting minutes as well as comments from Fed's Evans & Riksbank's Ohlsson headline today's thin economic docket.