Additionally, the greenback found further support after President Donald Trump announced successful trade-related phone talks with Chinese President Xi Jinping, noting that both leaders are preparing for an in-person meeting soon. While investors welcomed the news, market sentiment was rattled by Elon Musk’s criticism of a new fiscal bill that he warned could deepen the federal budget deficit. In response, Trump threatened to revoke government contracts awarded to Tesla Inc., triggering a 14% plunge in the company's stock and dragging broader equity indices lower.

Eurozone

The euro appreciated against the yen but declined versus the U.S. dollar and the British pound. Newly released Q1 GDP data beat expectations, showing a 0.6% quarterly expansion (vs. 0.3% forecast) and a 1.5% annual increase (vs. 1.2% projected). However, economists caution that these figures do not yet reflect the negative impact of U.S. export tariffs.

Germany's trade and industrial output indicators raise concerns for Q2: exports dropped 1.7% in April (vs. –0.5% forecast), while the trade surplus narrowed from €21.2B to €14.6B. Industrial production fell 1.4%, worse than the –0.9% estimate, pointing to mounting pressure on the manufacturing sector and a possible drag on broader eurozone performance.

United Kingdom

The British pound strengthened against the yen and the euro but slipped against the U.S. dollar. Housing data from Halifax Bank Plc disappointed investors, with prices falling 0.4% in May month-over-month (vs. 0.4% growth forecast) and slowing from 3.2% to 2.5% year-over-year. Analysts attribute the downturn to recent increases in property transaction taxes. While the construction sector remains broadly stable, its outlook hinges on the Bank of England’s interest rate trajectory and inflationary developments.

Japan

The yen weakened across the board amid soft consumer data. Household spending in April declined 1.8% month-over-month and 0.1% year-over-year, indicating that inflationary pressure is deterring consumers from making significant purchases. While wages are being adjusted upward, the pace of growth still lags behind inflation, suggesting the Bank of Japan may sustain its hawkish stance for longer to stabilize domestic prices.

Australia

The Australian dollar gained against the yen, pound, and euro, but lost ground to the U.S. dollar. April housing data showed a 5.7% monthly drop in building permits, in line with expectations. On an annual basis, permits were down 12%, exceeding forecasts of a 5.1% decline. However, approvals for private dwellings rose 3.1% after falling 4.5% in the previous month — a sign of underlying resilience in the housing sector, which is lending moderate support to the national currency.

Commodities: Crude Oil

Oil prices advanced as markets responded positively to U.S.–China diplomatic engagement and robust U.S. macroeconomic data. President Trump’s announcement of successful talks with Xi Jinping sparked optimism for a potential trade accord, which could reduce downside risks for global demand and sustain energy consumption levels.

Meanwhile, stronger-than-expected U.S. labor figures reinforced hopes that the world’s largest economy can avoid a near-term slowdown. Unemployment remained at 4.2%, employment surpassed projections at 139K, and wage growth accelerated to 0.4% MoM, with 3.9% YoY growth sustained. These signals of labor market stability helped lift sentiment in the oil market and provided further momentum for “black gold.”