Forex Today: GBP dumped on Brexit jitters, Fedspeaks, UK May eyed

Forex space in Asia witnessed quite a stir in early hours, as investors reacted to the weekend’s political news, especially the one out of the UK. The UK PM May and Brexit secretary Davis threatened to walk away from the Brexit negations if the country faces a massive bill of a EUR 100 billion. As a result, the pound was dumped across the board.

Meanwhile, the US dollar saw a minor-recovery against most of its major peers after last week’s declines, lifting the USD/JPY pair back above 111.50 levels. Among other related markets, the Asian indices traded firmer amid a rally in oil prices amid reports that OPEC and other major oil producers are on track to extend the supply cuts at a meeting on Thursday.

Later today, the EUR calendar remains data-dry, except for the German Bundesbank’s monthly report and Euro group meetings. The NA session also has nothing of relevance to be reported in terms of macro data, however, Fedspeaks, RBA Assistant governor Debelle and UK PM Theresa May’s speeches remain on the radar for fresh impetus.

Main topics in Asia

North Korea fired mid-range missile on Sunday, puts Hawaii and Alaska within range

Over the weekend, North Korea fired a mid-range missile near Pyongyang on Sunday, with the Korean Central News Agency (KCNA) noting that the current capabilities put Hawaii and Alaska within range.

Japanese exports rise for 5th straight month, surplus with US drops 4.2%

The data released by the Japanese Ministry of Finance (MoF) today showed the exports rose for the fifth straight month in April and the trade surplus with the US dropped 4.2% year-on-year. 

CME Group FedWatch's odds of a June rate hike rise back to 78.5%

President Trump’s visit to the Middle East has shifted the focus away from the political turmoil, while the Fed policymakers continue to signal potential for 2 more rate hikes this year. 

Fitch revises outlooks on Nomura and Daiwa to stable; affirms ratings

In its latest report released on Monday, the US-based Fitch ratings upwardly revised outlooks on the Japanese entities, Nomura and Daiwa, to Stable, while affirming their ratings.

Qatar joins call for OPEC deal rollover to March 2018 - Platts

Qatari oil minister Mohammad al-Sada said on Sunday, he joined a growing number of major oil producers calling for an extension to the OPEC and non-OPEC output cut deal to the end of March 2018, Platts reports.

Key Focus ahead

Trump to propose deep cuts to anti-poverty programs and Medicaid - BBG

Bloomberg out with latest headlines on the US Budget proposal, noting that Trump plans to propose $1.7 trillion in cuts to a category of spending that includes major social and entitlement programs for lower-income Americans.

Trump tour to steal the limelight for the week ahead – Rabobank

Michael Every, Senior Asia-Pacific Strategist at Rabobank, lists down the key market moving events and economic releases for the week ahead and suggests that US president Trump’s tour across the world will be the major event.

Politics and Fed minutes to dominate this week - ANZ

Analysts at ANZ explained that this week the data calendar is relatively light, with the key releases being the PMIs of Europe and Japan, although politics dominate. 

The week ahead: Q1 GDP second estimate in focus - Nomura

Analysts at Nomura explained that the minutes from the May FOMC meeting may give us an additional indication on the balance sheet adjustment specifics and how the FOMC assessed economic momentum in Q1.