USD Higher, As Yield Rebound Continues

The USD has been supported early doors today. The BBDXY sits +0.10% firmer, last near 1243. The is comfortably above late NY session highs from Friday (around 1242). Cross asset signals have been supportive for the USD, with US yields higher across the curve, although led by the front end (2yr to 4.52% ~+2.5bps).

• This is very much a continuation of the move from late in NY on Friday, while higher oil prices post Saudi's output cut announcement from the weekend are also likely to be aiding the US yield move. Brent is last around $77.70/bbl, +2% higher, but down from session highs. Following Friday’s mixed employment data, FOMC-dated OIS implied rates didn’t meaningfully change the odds of a 25bp hike on Jun 14 (+6bp), whilst the July terminal doesn't quite fully price in another hike with +20bps.
• US equity futures are also weaker. The Nasdaq off by close to 0.30%, Eminis last -0.10%, near 4283.
• AUD and NZD are the weakest performers. AUD/USD is back sub 0.6600, -0.20% for the session. NZD/USD is down by a similar amount, now tracking close to 0.6050/55.
• USD/JPY is back above 140.00, last 140.10/15, down slightly from session highs of 140.25. EUR/USD is back down through 1.0700.
• Coming up we have Australian Melbourne Institute inflation gauge for May, then Q1 GDP partials and ANZ job ads. Not long after the Caixin China Services PMI prints for May. Before then we get Japan services PMI revisions for May.