Morning Update – 26/05/2017 – by Arjun Lakhanpal

Morning all.. Wall St had another good session with the S&P closing up another 0.44% but FX markets remain trapped in tight ranges as US yields fail to budge. In Asia stocks were a little prone to profit taking into the weekend and the Nikkei fell 0.64% as USDJPY slipped on the back of higher inflation data. Japan Apr N’wide CPI: +0.4% y/y vs +0.2% prev; Core N’wide: +0.3% vs +0.4% cons; Core-Core (excl fresh food/energy): 0.0% y/y vs -0.1% prev.. The USD a tad higher elsewhere as AUD and GBP come under pressure whilst EUR holds 1.1200. Oil is down again with WTI down 0.3% and this holding USDCAD up. US 10yr yield stuck at 2.25%. UK CBI Qtrly Survey: demand in service sector flat in 3mths to May; rising inflation squeezing household incomes which is hitting consumer demand; at same time cost pressures are building across the board; optimism among business/professional firms improved for 1st time since Nov 2015. UK YouGov/CEBR: Consumer Conf Index falls to 107.9; consumers least confident about current financial situation since Dec 14; 12m expectations on finance also fell with perceptions about job security at 4 year low. Spiegel (cites Trump convos to EU officials): “the Germans are bad, very bad. See the millions of cars they are selling in the US. Terrible. We will stop this.” This morning we get very little with EU Consumer confidence data.. Good luck…