DXY popped overnight as a triple bunga of the Supreme Court frowning at Trump Fed interference, Greenland calm, and firming Japanese yields let air out of the pressure cooker.
AUD roared to new highs.
CNMY tailwind intact.
Gold came off, but not much.
Base metals, more so.
Markets have forgotten that RIO makes its money from iron ore.
EM OK.
Junk doing nuthin’.
Yields rolled over.
Stocks reversed higher.
First up, the Supreme Court is not impressed.
US Supreme Court justices suggested they are wary of President Donald Trump’s effort to fire Federal Reserve Governor Lisa Cook over unproven mortgage-fraud allegations, saying the move could upend the Fed’s independence and rattle markets.
Second, Europe hosed off Greenland.
President Donald Trump said he would refrain from imposing tariffs on goods from European nations opposing his effort to take possession of Greenland, citing a “framework of a future deal” he said was reached regarding the island.
Nobody knows what’s in the deal, but no doubt it will provide unfettered access to whatever with the ice block. If it is militarised, rather pointlessly, it might actually strengthen NATO.
Third, this:
Japanese Finance Minister Satsuki Katayama urged market participants to calm down after long-term government debt yields rose to their highest levels in decades. The sudden crash unleashed chaos on Tokyo trading desks and, coupled with Donald Trump’s threatened tariffs on European countries over Greenland, obliterated Wall Street’s subdued start to the year.
Maybe not enough, but the start of something.
It’s a triple-bunger for risk on. The only problem is, nobody has any cash left in the tank.
It’s enough to drive the AUD higher, for now.
