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No teamwork? No problem! Traders shrug off Trump’s G7 plot twist in favor of optimism ahead of the U.S.-NoKor meetings as well as this week’s central bank events.

  • NZ manufacturing sales (q/q) up by 0.6% vs. 2.6% increase in Q4 2017
  • Japan’s core machinery orders shoots up by 10.1% vs. 2.5% expected, -3.9% previous
  • Trump arrives in Singapore for U.S.-North Korea nuclear summit

Major Events/Reports:

Overall risk appetite

Asian session traders were pretty chill about Trump backing out of the G7 communiqué as they took on high-yielding assets despite threats of a global trade war.

Unless you were too busy rooting for your Tony Awards bets, you should know that Trump backed out of the G7 communiqué over the weekend. Not only that, but he started attacking (through tweets, of course) leaders of the major U.S. allies:

While the attacks could lead to retaliatory tariffs from trading partners like Canada and Germany, it seems like traders are deciding to price in any more trade war threats when the policies actually start dropping.

Instead, they’re focusing on possible peace progress as Trump meets with Kim Jong Un over the next couple of days. In addition to that, the Fed and ECB are also sharing their policy decisions this week where they’re expected to be more hawkish (or at least less dovish) than in their last decisions.

  • Nikkei is up by 0.66% to 22,843.3
  • A SX 200 is up by 0.16% to 6,061.3
  • Hang Seng is up by 0.31% to 31,055.7
  • Shanghai index is down by 0.26% to 3,059.058

Even commodity prices were lifted, though oil was stuck in negative territory for most of the session before squeezing out small gains.

  • Gold is up by 0.11% to $1,299.17
  • Brent crude oil is up by 0.01% to $76.38
  • U.S. WTI is up by 0.15% to $65.59

Major Market Mover(s):

CAD

The Loonie was one-two punched by Trump’s post-G7 meeting tweets as well as oil prices struggling after last Friday’s Baker Hughes report showed an additional oil rig in the U.S.

USD/CAD is up by 40 pips (+0.31%) to 1.2965
EUR/CAD is up by 76 pips (+0.50%) to 1.5286
GBP/CAD is up by 55 pips (+0.32%) to 1.7383
NZD/CAD is up by 37 pips (+0.41%) to .9123

JPY and CHF

Low-yielding currencies like the yen and franc took the biggest hits as traders bought their riskier, higher-yielding counterparts.

EUR/JPY is up by 53 pips (+0.41%) to 129.38
AUD/JPY is up by 27 pips (+0.32%) to 83.45
USD/JPY is up by 23 pips (+0.20%) to 109.74
GBP/JPY is up by 32 pips (+0.22%) to 147.14

USD/CHF is up by 11 pips (+0.11%) to .9855
EUR/CHF is up by 36 pips (+0.31%) to 1.1620
AUD/CHF is up by 17 pips (+0.22%) to .7494
NZD/CHF is up by 19 pips (+0.27%) to .6934

Watch Out For:

  • 6:00 am GMT: Japan’s preliminary machine tool orders (y/y)
  • 8:00 am GMT: Italy’s industrial production (-0.7% expected, 1.2% previous)
  • 8:30 am GMT: U.K.’s manufacturing production (0.3% expected, -0.1% previous)
  • 8:30 am GMT: U.K.’s goods trade balance (-11.5B GBP expected, -12.3B GBP previous)
  • 8:30 am GMT: U.K.’s construction output (2.4% expected, -2.3% previous)
  • 8:30 am GMT: U.K.’s industrial production to remain at 0.1%?
  • London session: NIESR U.K. GDP estimate