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Most dollar pairs were chillin’ like ice cream fillin’ during the New York session while yen pairs were in a frenzy thanks to North Korea’s announcement about continuing its nuclear weapons tests.

  • Canadian building permits slumped by 5.8% vs. projected 4.2% rebound in March
  • U.S. JOLTS job openings up from 5.68M to 5.74M vs. 5.67M forecast
  • U.S. final wholesale inventories up by 0.2% vs. estimated 0.1% dip
  • U.S. IBD/TIPP Economic Optimism index down from 51.7 to 51.3 this month
  • North Korea’s ambassador to the U.K. said another nuclear test is in order
  • New South Korean president said to prefer dialogue between two Koreas

Major Events:

North Korea talks nuclear… again!

Tension in the Asian region was heightened once more after North Korean ambassador to the U.K. mentioned in an interview that they are gearing up for their sixth nuclear weapons test.

“If the U.S. moves an inch, then we are ready to turn to ashes any available strategic assets of the U.S.,” threatened Ambassador Choe Il. Although political experts maintained that North Korea’s bark is worse than it’s bite when it comes to staging an attack on Uncle Sam, they did warn that those nuclear tests and any provocation could do some damage to nearby Asian countries.

Market watchers are also a bit concerned about the outcome of the elections in South Korea as the country elected a leader who is rumored to be a North Korean sympathizer. President Moon Jae-in is said to advocate dialogue between the two Koreas and has strongly criticized Trump’s decision to charge South Korea for the THAAD missile system deployment costs. Awkward.

Mixed medium-tier U.S. data

On the economic front, things have been so-so in the U.S. as a couple of reports missed expectations slightly while another jobs report printed stronger than expected results.

The JOLTS job openings figure for March jumped from 5.68 million to 5.74 million, outpacing the expected dip to 5.67 million to indicate that there are plenty of opportunities in the labor market. The number of openings increased in professional and business services, other services, and state and local government education sectors.

On the flip side, final wholesale inventories rose 0.2% in March instead of falling by 0.1% to suggest that business output is merely ending up in stockpiles instead of fulfilling consumer demand. This could also be indicative of lower business spending down the line as companies won’t have to step up production until these inventories are depleted.

Also, the IBD/TIPP Economic Optimism index ticked down from 51.7 to 51.3 this month instead of improving to the consensus at 52.3 to reflect weaker confidence among consumers. In particular, the respondents’ six-month economic outlook and personal financial outlook chalked up back-to-back declines.

  • S&P 500 index dipped 2.46 points to 2,396.92 (-0.10%)
  • Nasdaq rose 17.93 points to 6,120.59 (+0.29%)
  • Dow 30 index fell 36.50 points to 20,975.78 (-0.17%)

Major Market Movers:

JPY

The yen was the biggest loser for the day as the resurgence of geopolitical risk from the Korean peninsula led traders to dump the Asian currency.

USD/JPY rallied from 113.64 to a high of 114.31 (0.59%), EUR/JPY advanced from 124.01 to a high of 124.54 (0.42%), GBP/JPY climbed from 147.05 to a high of 147.80 (0.51%), and AUD/JPY rose from 83.55 to a high of 84.03 (0.57%).

Watch Out For:

  • 2:30 am GMT: Chinese CPI y/y (1.1% expected, 0.9% previous)
  • 2:30 am GMT: Chinese PPI y/y (6.8% expected, 7.6% previous)
  • 6:00 am GMT: Japanese leading indicators (105.5% expected, 104.8% previous)