🇺🇸 United States: Dollar Dips, Trade Hopes Build

The US dollar is coming under pressure, softening against the euro, pound, and yen. Labor market data remains in focus: while unemployment stuck at 4.2%, nonfarm payrolls exceeded expectations with 139,000 new jobs (vs. 126,000 forecast). But what’s got investors talking are the high-profile US-China trade talks set for London. Senior officials—US Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and Trade Representative Jamieson Greer—will face off with Chinese Vice Premier He Lifeng. Such heavyweight delegations suggest both sides are serious about hashing out a broad trade agreement that could shift the currency landscape.

🇪🇺 Eurozone: ECB Hints at Pause, Euro Finds Support

Over in Europe, the euro is gaining on the dollar, but losing ground to the pound and yen. All eyes are on the European Central Bank after it cut rates for the eighth straight meeting—a pace of monetary easing not seen since the 2008 crisis. The deposit rate now stands at 2.0%. But a policy pause could be looming: ECB officials and Slovak Central Bank head Peter Kazimir both hint the time has come to see how previous moves play out, with just one more cut to 1.75% forecast by year-end. Traders are recalibrating their expectations as the ECB shifts gears.

🇬🇧 United Kingdom: Pound Rallies, BoE May Ease QT

The British pound is on the offensive, gaining against the euro and dollar, though slipping against the yen. According to Bank of America, the Bank of England could scale back its quantitative tightening (QT) program as soon as October, with bond purchases potentially falling from £100B to £60B. Market watchers are eyeing the June 19 BoE meeting for signals that a policy tweak is coming, as current QT levels might hinder future monetary easing.

🇯🇵 Japan: Yen Strengthens, Economy Beats Forecasts

The Japanese yen is flexing its muscles, firming up against the euro, pound, and dollar. The latest GDP report showed 0.0% growth in Q1 (better than –0.2% predicted), while annualized GDP fell only –0.2% instead of –0.7%. The GDP deflator ticked up from 2.9% to 3.3%. Importantly, consumer spending held steady at 0.1%, easing fears at the Bank of Japan about slumping demand and supporting the case for a cautious, hawkish stance.

🇦🇺 Australia: Aussie Dollar Holds Firm, China Talks Loom Large

The Australian dollar is on solid footing, advancing against major peers. With US-China trade negotiations looming in London—and China being a top market for Aussie exports—a positive outcome could fuel even more gains. Local trading is paused for a public holiday, but attention turns to the Westpac consumer sentiment report out Tuesday. Back-to-back positive readings could boost the AUD further.

🛢 Oil: Prices Slide Ahead of Trade Talks, Venezuela Issues Warning

Oil prices are under pressure, slipping back to the $66.00 level. Traders are waiting for news from the US-China meeting—an agreement could ease US tariff pressure and spark a rebound in global demand. Closer to home, Venezuela’s government has warned of a 50% rise in fuel prices after US oil majors exit the market, a move expected to tighten the nation’s budget and further strain local consumers.