Market wrap: broad based dollar weakness - Westpac

Analysts at Westpac offered a market wrap for the US session.

Key Quotes:

"Global market sentiment: Broad-based US dollar weakness was the main theme among currencies, while risk sentiment was firm (S&P500 +0.7%, Brent crude oil +2.1%, copper +1.9%).

Interest rates: US 10yr treasury yields ranged sideways between 2.23% and 2.26%, 2yr yields between 1.27% and 1.29%. Fed fund futures yields firmed slightly, pricing a June rate hike as an 85% chance (from 80% the previous day).

The CFTC speculative futures positioning report showed 3mth Eurodollar shorts were reduced, while 10yr treasury longs were increased.

Currencies: The US dollar index closed Friday down 0.8%, to a six-month low. EUR rose from 1.1100 to 1.1212 – a six-month high. USD/JPY ranged sideways between 111.00 and 111.70. AUD rose from 0.7420 to 0.7470. NZD rose from 0.6885 to 0.6940. AUD/NZD initially rose from 1.0745 to 1.0820 but later retraced.

The CFTC report showed US dollar index longs were reduced, EUR longs were increased, AUD longs were reduced, and NZD shorts were little changed."