June Monthly drops. Highlights include: likely rate hikes by BOJ and ECB, UK byelection can set stage for formal challenge of Starmer, and in the US, Warsh chairs 1st FOMC meeting and updated dot plot. SCOTUS may decide Cook firing case. See www.marctomarket.com/2026/05/june...

June Monthly drops. Highlights include: likely rate hikes by BOJ and ECB, UK byelection can set stage for formal challenge of Starmer, and in the US, Warsh chairs 1st FOMC meeting and updated dot plot. SCOTUS may decide Cook firing case. See www.marctomarket.com/2026/05/june...

Dismal Canadian Q1 GDP. A -0.1% contraction while the median in Bloomberg's survey was for a 1.5% annualized increase. Q4 25 GDP was revised to show a 1% contraction rather than 0.6%. Some call it technical recession. #$USD rises to CAD1.3830. Yesterday's high was ~CAD1.3870.

The Middle East ceasefire is known increasingly by its violations, and yet the market has taken it in stride. Risk-taking is limited, but Brent and WTI are within yesterday's ranges. The #$USD is firmer. Geopolitics may trump the slew of US data. See www.marctomarket.com/2026/05/rest...

The lack of further developments from the Middle East today has not deterred a further pullback in oil prices or the continued rally in equities. There has been limited #$USD movement. BOJ intervention confirmed over the past month JPY11.7 trln/$73.5 bln) www.marctomarket.com/2026/05/hope...

The Middle East ceasefire is known increasingly by its violations, and yet the market has taken it in stride. Risk-taking is limited, but Brent and WTI are within yesterday's ranges. The #$USD is firmer. Geopolitics may trump the slew of US data. See www.marctomarket.com/2026/05/rest...

Looking for a read for the way home. Try this. What is the #$USD's secret sauce? It might not be what you think.

New piece in Barron's with Adam Farhat, Univ of Sussex grad student..."The Myth of the Petrodollar Collapse". Complimentary, link to new Barron's piece: The Myth of the Petrodollar Collapse barrons.com/articles/the... no paywall, just click down.

Despite new hostilities in the ME, and neither side compromising, many seem to remain hopeful that a resolution is near. Oil is $3 lower. Stocks and bonds are mostly higher. USD is mixed. Hawkish hold lifts Kiwi while soft inflation is a drag on the A$. www.marctomarket.com/2026/05/geop...

Despite new hostilities in the ME, and neither side compromising, many seem to remain hopeful that a resolution is near. Oil is $3 lower. Stocks and bonds are mostly higher. USD is mixed. Hawkish hold lifts Kiwi while soft inflation is a drag on the A$. www.marctomarket.com/2026/05/geop...

Middle East ceasefire violated, but market reaction toward risk-off has been restrained. North American investor response awaited. Otherwise news stream is light. #$USD is mostly slightly firmer, with consolidative tone. See www.marctomarket.com/2026/05/ceas...

Middle East ceasefire violated, but market reaction toward risk-off has been restrained. North American investor response awaited. Otherwise news stream is light. #$USD is mostly slightly firmer, with consolidative tone. See www.marctomarket.com/2026/05/ceas...

New weekly commentary here: marctomarket.com/2026/05/week... Resilience of US econ and shift in rate expectations buoy the #$USD, but this phase of rate adjustment seems nearly complete momentum indicators are getting stretched. Beware of reversal patterns.

The Fed reports its custody holdings of Treasuries and Agencies every Thursday. In the past two weeks, custody holdings have fallen by $58 bln, the most for a 2-wk period since last August. Since the war began, they have fallen by ~$105 bln. (1/3)

The 60-day correlation between DXY and the offshore yuan appears to be at a record level (0.80+). Rather that blaming China, for which there is little we can do the surest way to achieve RMB strength (and #$JPY, #$EURO and most currencies) is to seek a weaker USD, imho.

Portfolio flows may not explain the yen's weakness--off 1.5% this year, the second weakest among the G10 currencies. Through the first 20 weeks of the year, and drawing from weekly MOF data, here is what it looks like:

USD comes back better bid with tensions still elevated in the Middle East. However, stocks and bonds are stronger. Yet, ahead of long holiday weekend in US and UK, the North American appetite for risk may be limited. See www.marctomarket.com/2026/05/stoc...

#$USD setback appears to be driven by reports suggesting an agreement between the US and Iran has been found. Unable to collaborate, but and scar tissue says to be skeptical. Still, once again the market has shown what it wants to do in case of peace.

#$USD is better bid today. It recovered from the late decline in NY yesterday as little new to feed hopes. Polymarket odds of SOH opening by end of next month is around 35% and a little less than 50% by end of July. See www.marctomarket.com/2026/05/flas...

#$USD is better bid today. It recovered from the late decline in NY yesterday as little new to feed hopes. Polymarket odds of SOH opening by end of next month is around 35% and a little less than 50% by end of July. See www.marctomarket.com/2026/05/flas...

One element of American exceptionalism is that the US dollar is correlated with change in US rates, but several other currencies, including the euro and sterling, are inversely correlated with changes in their rates. (1/3)

#$JPY has a 7-day slide in tow coming into today. No BOJ intervention. #$USD in narrow range around JPY159. #$EURO straddling $1.16. Softer UK CPI leaves #$GBP hovering around $1.34. Oil softer on reports 3 takers passed SOH. FOMC minutes and NVDA earnings later today. marctomarket.com/2026/05/mark...

In nearly all the comments about the sell-off in US bonds, what I think is missing is the change in expectations for overnight rates. Implied yr end rate for Fed funds has risen 75 bp since start of the war. The 10-year yld is up 65 bp and the 10-year yield is up 55 bp. QED.

I did not do a good job of anticipating BOJ intervention at the end of April. I thought the conditions were not met and that officials I knew at the BOJ/MOF were more sophisticated that intervening to protect a set nominal level. Still, with the dollar up for the 7th (1/2)

I did not do a good job of anticipating BOJ intervention at the end of April. I thought the conditions were not met and that officials I knew at the BOJ/MOF were more sophisticated that intervening to protect a set nominal level. Still, with the dollar up for the 7th (1/2)

North American participants took US announcement it would not strike Iran today as a hopeful sign of progress, but Asian & European players were less sanguine. The #$USD recouped some of what it lost late yesterday. Mkt tempts BOJ with JPY159+. See www.marctomarket.com/2026/05/asia...

#$USD pullback in Europe may be seen as a new buying opportunity by North American participants. Note chunky option -$1.1600 for 3.75 bln euros and ~1.3 bln and 2 bln tomorrow at $1.1650. JPY159 for $4.7 bln of options expire today. A$855 bln at $0.7170. www.marctomarket.com/2026/05/taka...

Storm on social media: POTUS says at request of Gulf allies canceling tomorrow's strike on Iran. Reuters reports that in Fortune, POTUS seems to recognize that lower rates may have to wait until after the war ends. #$USD softens. Rates ease to almost unchanged.

#$USD pullback in Europe may be seen as a new buying opportunity by North American participants. Note chunky option -$1.1600 for 3.75 bln euros and ~1.3 bln and 2 bln tomorrow at $1.1650. JPY159 for $4.7 bln of options expire today. A$855 bln at $0.7170. www.marctomarket.com/2026/05/taka...

Re-acceleration of the US economy, elevated prices, and a backing up of US rates fueled #$USD's best week in a couple of months. Mkt probing Japan's tolerance with 5-day sell-off of #$JPY. Starmer's woes weigh on #$GBP and Gilts. See www.marctomarket.com/2026/05/week...

Re-acceleration of the US economy, elevated prices, and a backing up of US rates fueled #$USD's best week in a couple of months. Mkt probing Japan's tolerance with 5-day sell-off of #$JPY. Starmer's woes weigh on #$GBP and Gilts. See www.marctomarket.com/2026/05/week...

ICYMI

#$USD rallied strongly through the European morning and is pulling back ahead of the US open. Stocks and bonds have been hit hard. UK political drama play out. Oil prices extend gains. Mkt tests Japanese resolve on #$JPY. See marctomarket.com/2026/05/gree...

#$USD rallied strongly through the European morning and is pulling back ahead of the US open. Stocks and bonds have been hit hard. UK political drama play out. Oil prices extend gains. Mkt tests Japanese resolve on #$JPY. See marctomarket.com/2026/05/gree...

#$USD is trading quietly, but still looks poised to break higher. Mkt paused near JPY158 where BOJ is believed to have intervened last week. Starmer's rivals preparing challenge. Xi-Trump exchange platitudes. Opening up China vs de-risking. See marctomarket.com/2026/05/us-d...

#$USD is trading quietly, but still looks poised to break higher. Mkt paused near JPY158 where BOJ is believed to have intervened last week. Starmer's rivals preparing challenge. Xi-Trump exchange platitudes. Opening up China vs de-risking. See marctomarket.com/2026/05/us-d...

The euro frayed $1.17, where chunky options expire today and tomorrow. #$GBP slipped through $1.35, where modest options expire today. Momentum indicators favor downside break eventually. USD approaches JPY158 where BOJ may have sold last week. www.marctomarket.com/2026/05/the-...

Many observers trying to put the UAE swap line request in some kind of US-PRC FX competition frame or dismissive given the UAE's apparent lack of need for dollars. I think they miss the 800 lb gorilla in the room--the erosion of trust/confidence in US political commitment.

#$USD is bid. Fragility of ceasefire weighs on sentiment. Drags equities and bonds lower. PBOC set #$USD fix at new multiyear low. Bessent and Japanese officials talk fx but #$JPY falls to new 5-day low. US CPI on tap. Starmer hanging on; #$GBP lower. See www.marctomarket.com/2026/05/ceas...

My sense is talk of US-UAE swap line is not being framed right. The UAE broke from OPEC and is an ally of Israel. It has suffered Iranian attacks. It wants a ring, entry into an exclusive club--not because of RMB alternative, but because of questions about the US commitment.

Week ahead highlights: US and PRC CPI, Bessent talks #$JPY in Japan, and G2 summit in Beijing. After ordering Fed to check exchange rates in Jan, Bessent quiet on recent BOJ intervention. Outcome of Xi-Trump likely minimal. See www.marctomarket.com/2026/05/week...

Is the US rejection of Iran's counter-proposal a negotiating tactic or the end of the ceasefire? UK's Starmer continues to fight for his political life. PBOC sets new 3yr low #$USD fix after higher CPI and PPI. See marctomarket.com/2026/05/mond...

Is the US rejection of Iran's counter-proposal a negotiating tactic or the end of the ceasefire? UK's Starmer continues to fight for his political life. PBOC sets new 3yr low #$USD fix after higher CPI and PPI. See marctomarket.com/2026/05/mond...

Week ahead highlights: US and PRC CPI, Bessent talks #$JPY in Japan, and G2 summit in Beijing. After ordering Fed to check exchange rates in Jan, Bessent quiet on recent BOJ intervention. Outcome of Xi-Trump likely minimal. See www.marctomarket.com/2026/05/week...

#$USD has a softer profile today, ahead of the jobs report. The mkt appears to have largely shrugged off the sharp defeat of Labour in UK local elections and an unexpected decline in German industrial output. Tensions running high in the Middle East. See www.marctomarket.com/2026/05/us-j...

The mild appreciation of the RMB is unlikely to have much impact on trade flows. China's price advantage is greater than CNY gains and demand for many other products (solar panels, rare earths, e.g.) may not be sensitive to fx. See www.marctomarket.com/2026/05/the-...

#$USD has a softer profile today, ahead of the jobs report. The mkt appears to have largely shrugged off the sharp defeat of Labour in UK local elections and an unexpected decline in German industrial output. Tensions running high in the Middle East. See www.marctomarket.com/2026/05/us-j...

Interesting FX options expiring in US tomorrow $1.1750 for 1.57 bln euros and $1.18 for 1.77 bln euros $1.1600 for GBP1.35 bln and $1.3550 for GBP485 mln JPY157 for $620 mln $0.7200 for A$880 mln CAD1.3600 for $790 mln www.marctomarket.com

Clip India Tonight | What’s driving the global rally—easing Middle East tensions or the AI investment boom? David Roche & Marc Chandler decode the surge across equities, gold, silver, and commodities, and what it means for markets ahead. www.marctomarket.com Clip: youtube.com/watch?v=k_WP...

The mild appreciation of the RMB is unlikely to have much impact on trade flows. China's price advantage is greater than CNY gains and demand for many other products (solar panels, rare earths, e.g.) may not be sensitive to fx. See www.marctomarket.com/2026/05/the-...