Morning Update – 17/05/2017 – by Arjun Lakhanpal

Morning all.. Wall St closed around unchanged as a rally into the close (again) calmed nerves after a poor start. However the USD and Yields were lower and in Asia stocks weakened. The Nikkei closing down 0.65% dragging USDJPY lower and aided and abetted by falling US yields as the 10yr traded below 2.3% last night.. There was a risk off sentiment through the Asian session as the API oil inventory data late in the NY session sent oil lower yet again. WTI is down marginally in Asia after a weak close in NY. USDJPY sits on session lows at 112.35. The dollar generally is lower and EUR has broken above 1.1100 making a high of 1.1118 as US yields fall. EUR crosses still in demand in Asia after a strong showing in Europe. In Japan, BoJ’s Kuroda (after meeting w PM Abe): inflation still far from BoJ target, told Abe will continue with current easing policy; discussed global economic developments, told Abe Japanese economy steadily recovering; no comment on any discussion of 2nd term as BoJ Gov-Japan Ind Prod falls on the month: -1.9% m/m & 3.5% y/y. China Economic Daily: China’s financial deleveraging will continue; regulatory clampdown on risky lending has not achieved goals yet. In Oz, S&P: affirmed Australia AAA rating, retains neg outlook; rating rests on moderation in housing and credit-Australia wage prices in-line: 0.5% q/q & 1.9% y/y.. This morning we get Italian Trade balance and unemployment data from the UK. After that it is EU CPI (Inflation) data. There is no US data of note today.. Good luck..