GGMA Morning Brief: Asian stocks decline, commodities rally, Won weakens / Trump deadline / Japan wages / Fed speak review / Tudor on AI / Dalio warnings / Gundlach worried / US payrolls in focus
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
Good morning,
I hope all is well.
Here are the main market movers and overnight stories:
Markets Briefing: Asian stock markets decline / USDKRW rises / Commodities rally
Asia-Pacific equity markets fell as US-Iran clashes in the Strait of Hormuz tested the fragile ceasefire. ASX futures dropped -1.47%, the Hang Seng lost -1.14%, the Nikkei fell -0.73%, and the NZX slid -0.93%. The Kospi 200 dipped -0.52% and the CSI 300 eased -0.49%, while MSCI EM bucked the trend with a +0.56% gain.
Copper led the commodity complex, rallying +1.69% as industrial metals broadly gained +0.51%. The Bloomberg Energy subindex rose +0.74% (W/W: -4.33%) as supply disruption fears from the Hormuz skirmishes supported crude. Precious metals climbed +0.51%, with gold (XAUUSD) up +0.61% on safe-haven demand. .1
The Korean won weakened with USDKRW +0.91%, despite a record current account surplus release. The euro edged up with EURUSD +0.14%, while GBPUSD gained +0.20%. Bitcoin fell -0.33% and Ethereum dropped -0.53%.
US bond yields are only a little changed. Fed’s Kashkari flagged uncertainty on the rate path due to the Iran war.
The session ahead will be dominated by US Non-Farm Payrolls (consensus 60-65K, prev 178K) and a heavy central bank speaker slate including Lagarde, Bailey, Cook, and Bowman.
Markets debate if Japan sold treasuries when intervening in yen
The Federal Reserve's Treasury holdings fell to $2.73 trillion in the week ending May 6, marking the first drop in a month. This decline aligns with Japan's estimated $54.7 billion currency intervention, likely involving Treasury sales. Any reduction in Japan's Treasury holdings could push US yields higher, already rising due to increasing oil prices and worries about America's fiscal deficit amid the Iran war. (BBG)
Meanwhile, Japan intervened in the foreign exchange market during holidays in early May, in addition to yen-buying operations conducted on April 30, in repeated bouts of intervention in markets, a source familiar with the matter told Reuters on Friday. The intervention since the start of May was timed to coincide with the holiday period, when market liquidity was thin, the source said, declining to be identified because the matter is private.
Japan’s real wages rise for third month to keep BOJ on hike path
Japan’s average cash earnings rose 2.7% year-on-year in March, well below the 3.2% consensus and down from 3.3% prior. Real wages climbed 1.0%, the third consecutive positive month but below the 1.8% expected. The data complicates the BoJ’s case for further rate normalisation as scheduled full-time pay growth also disappointed. (Bloomberg)
Trump sets July 4 deadline for EU to comply with trade deal or face 'much higher' tariffs
New Trump deadline delays imminent threat of 25% tariff on EU cars. Trump 'waiting patiently' for EU to implement 2025 trade deal scrapping tariffs on U.S. industrial goods. U.S., EU leaders agree that Iran must never possess a nuclear weapon. EU parliament has 'some way to go' to agree on implementing legislation, trade committee chair says. (RTRS)
Fed’s Kashkari Says Next Rate Move Uncertain Because of Iran War
Federal Reserve Bank of Minneapolis President Neel Kashkari said the conflict in the Middle East has added uncertainty to the outlook for interest rates.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
Good luck, and feel free to ping me in the chat to discuss markets and views!
PS:
· Did you know that you can register and follow us 24/7 here? Then download our app from the Apple Store to listen to our Squawk on the go or chat with us live.
· If you are on Bloomberg and would like to see my comments in real-time, or if you are a MacroBond user and would like to get access to my chart bank, please send an email to: [email protected] .
Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.
“Given the uncertainty around the Iran war, I actually don’t know what the future holds,” Kashkari said Thursday during an event in Marquette, Michigan. “If the Strait of Hormuz is closed for an extended period of time, it may well be that the next move might need to be up in interest rates.” (BBG)
Meanwhile, Federal Reserve Bank of San Francisco President Mary Daly downplayed division among policymakers over the central bank’s policy statement. Daly said the phrasing of the statement is less important than the actions of the Fed’s rate-setting committee and that everyone agreed to the decision. Daly said monetary policy is slightly restrictive and would put downward pressure on inflation should the US war in Iran resolve. (BBG)
Paul Tudor Jones says AI bull market has ‘another year or two to run’
While AI development is in early stages, Paul Tudor Jones said the bull market continues to feel like the 1999 period, about a year before dot-com share prices peaked in early 2000. When it does end, Jones said the market drawdown could be significant. (CNN)
Ray Dalio says US is entering period of ‘great turbulence’
Ray Dalio predicts ongoing instability in the US due to deficits, wealth disparity, political divides, geopolitical changes, and AI disruption. He advises investors to diversify portfolios, including 5-15% gold, noting historic trends of falling fiat currencies and rising gold. (BBG)
Gundlach takes longshot bet in case of US debt restructuring
Jeffrey Gundlach of DoubleLine Capital is shifting some funds, swapping higher-coupon Treasuries for lower-coupon ones of similar maturity. He anticipates that, in a severe recession, the US government might unilaterally reduce coupon payments on its debt to cut interest costs—a scenario he describes as "the ultimate way of kicking the can down the road." (BBG)
Big Tech’s $725bn AI spending spree sends free cash flow to a decade low
Big Tech’s record $725bn AI investment strategy is beginning to strain the resources of America’s largest companies, leaving them with less cash left over this year than at any point in the past decade. (FT)
UK Labour Hemorrhages Council Seats as Reform UK Surges in Local Elections (RTRS)
Labour lost control of seven councils including Hartlepool, Tamworth, and Wandsworth as early local election results rolled in. Reform UK won all 12 seats it contested in Hartlepool. Projected losses of up to 2,000 seats raise the prospect of a leadership challenge against Starmer.
Today’s Macro Roadmap: US non-farm payrolls / Canada labour market / ECB, BOE & Fed speak
US Nonfarm Payrolls (April) — 14:30 CET
Consensus: +60-65k (TE: 60k, Investing: 65k). Previous: +178k. This is the most important data release of the week.
A weak NFP print (below 50k) would reignite rate-cut expectations and pressure the dollar, while a strong print (above 100k) would reinforce the Fed’s hawkish hold and support yields. The read-through for the Fed is complicated by the war-driven inflation overlay — even a weak labour market may not trigger cuts if inflation remains elevated. Wage growth is closely watched for second-round inflation effects from the energy price shock. A hot print above +0.4% would add to the stagflation narrative; a soft print would ease pressure on the Fed.
Consensus expects the unemployment rate to stay at 4.3%. An unchanged reading would keep the unemployment rate within the Fed’s comfort zone.
Recent job market volatility is partly due to changes in the birth-and-death model used by the government to track employment from company openings and closings. High firm turnover, weather events, strikes, government job cuts, and immigration policy shifts have also contributed. Economists suggest using a three-month moving average of payrolls for a clearer view of labor trends. (YF)
Michigan Consumer Sentiment (Preliminary May) — 16:00 CET
Previous: 49.5. Consumer confidence has been under pressure from rising gasoline prices — the AAA reported prices breaching $4.50/gallon for the first time since July 2022. A further decline would underscore the consumer-spending headwind from the energy shock.
Central bank activity overview
An extraordinary speaker slate spans both continents. The ECB deploys five voices: Lagarde (09:00-09:05), de Guindos (09:05), Cipollone (13:30), Schnabel (18:00 — Charles Goodhart event), and Bundesbank President Nagel (18:15). On the Fed side, Governor Cook (11:45) and Vice Chair for Supervision Bowman (14:20) speak — Bowman’s dovish lean (three SEP cuts for 2026) contrasts sharply with yesterday’s hawkish dissenters Kashkari and Hammack. BoE Governor Bailey (14:00) rounds out a day where the world’s three major central banks are all represented at senior level.
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Financial Markets Monitor
Disclaimer: This article is for informational and educational purposes only and should not be construed as financial, investment, or professional advice. The content represents the author's personal views and analysis and does not constitute a recommendation to buy, sell, or hold any securities or financial instruments. Readers should conduct their own research and consult with a qualified financial advisor before making any investment decisions. Past performance is not indicative of future results, and all investments carry risk, including the potential loss of principal.