· Dollar lifted by jobs data, but records third straight weekly loss
The dollar was modestly higher on Friday after data showed the U.S. labor market unexpectedly improved in May, but the currency ended the week lower, for a third consecutive week, as uncertainty about the U.S. economy capped gains.
The Labor Department’s employment report showed the jobless rate fell to 13.3% last month from 14.7% in April, which was a post-World War Two high. It came on the heel of surveys showing consumer confidence, manufacturing and services industries stabilizing. Economic conditions have significantly improved as businesses have begun to reopen after shuttering in mid-March to slow the spread of COVID-19.
The U.S. dollar index =USD late Friday was up 0.18% to 96.93. It was down 1.4% from last Friday's close. On the day, the dollar was 0.38% stronger against the euro EUR=, at $1.129. Against the safe-haven Japanese yen JPY=, the dollar was up 0.44% to 109.61 yen.
· Surprise May U.S. payrolls rise fans hopes for economic recovery
The U.S. unemployment rate unexpectedly fell in May and layoffs abated, the Labor Department said on Friday in a report that showed the latest signs the economic downturn caused by the COVID-19 pandemic was bottoming.
The Labor Department’s closely watched monthly employment report showed the jobless rate dropped to 13.3% last month from 14.7% in April. Nonfarm payrolls rose by 2.509 million jobs after a record plunge of 20.687 million in April.
· Trump says he views U.S.-China trade deal differently amid coronavirus
U.S. President Donald Trump said on Friday he views the Phase 1 trade deal inked between the United States and China differently in the wake of the coronavirus pandemic.
“I guess I view the trade deal a little bit differently than I did three months ago,” Trump said at a news conference in the White House Rose Garden.
“Getting along with China would be a good thing. I don’t know if that’s going to happen. I’ll let you know,” he added.
· Fed's Powell scheduled for congressional appearances June 16-17
Federal Reserve Chair Jerome Powell will testify before the U.S. Congress on June 16 and 17 in hearings on the central bank’s semi-annual monetary policy report.
By statute, the Fed delivers the report providing an overview of the economy twice a year, usually in February and again in June or July, and the chair appears in successive days of hearings before the Senate Banking and House Financial Services committees.
He will testify to the Senate committee on June 16 and the House panel on June 17, calendars published by the committees showed.
· Trump threatens EU, China with tariffs; names Navarro 'lobster king'
U.S. President Donald Trump on Friday threatened to impose tariffs on European Union cars if the bloc does not drop its tariff on American lobsters, naming White House trade adviser Peter Navarro the “lobster king” in charge of talks.
Trump, speaking at an event with commercial fishermen, also asked Navarro to identify Chinese products to hit with tariffs unless Beijing dropped its duties on American lobsters.
“If the European Union doesn’t drop that tariff immediately, we’re going to put a tariff on their cars, which will be equivalent,” Trump said.
· British PM offers to accept EU tariffs on some goods to win trade deal: Daily Mail
British Prime Minister Boris Johnson is willing to accept European Union tariffs on some UK goods in an attempt to win a trade deal and break the deadlock in talks with the EU, the Daily Mail reported.
Britain’s chief negotiator, David Frost, had made a new offer, the newspaper said, citing sources.
According to the offer, the UK would accept tariffs on a small number of goods in return for the European Union dropping its demand that Britain continue to follow EU rules.
· Japan declines to join U.S., others in condemning China for Hong Kong law: Kyodo
Japan has decided not join the United States, Britain and others in issuing a statement scolding China for imposing a new security law, Kyodo news agency reported on Sunday, citing officials from countries involved.
The United Kingdom, the U.S., Australia and Canada condemned China on May 28 for imposing a law that they said would threaten freedom and breach a 1984 Sino-British agreement on the autonomy of the former colony.
· France tells China it still backs 'one country, two systems' for Hong Kong
French President Emmanuel Macron has told Chinese counterpart Xi Jinping he is following events in Hong Kong closely and continues to back the “one country, two systems” principle for Beijing’s rule over the city, an Elysee official said.
“The President said he was monitoring the (Hong Kong) situation closely and reiterated France’s support for the principle of ‘one country, two systems’,” the official told Reuters on Saturday.
· China May exports slip back into contraction, imports worst in four years
China’s exports contracted in May as global coronavirus lockdowns continued to devastate demand, while a sharper-than-expected fall in imports pointed to mounting pressure on manufacturers as global growth stalls.
The sombre trade readings for the world’s second-biggest economy could pile pressure on policymakers to roll out more support for a sector that is critical to the livelihoods of more than 180 million workers. Total trade accounts for about a third of the economy.
Overseas shipments in May fell 3.3% from a year earlier, after a surprising 3.5% gain in April, customs data showed on Sunday. That compared with a 7% drop forecast in a Reuters poll.
While exports fared slightly better than expected, imports tumbled 16.7% compared with a year earlier, worsening from a 14.2% decline the previous month and marking the sharpest decline since January 2016.
It had been expected to fall 9.7% in May.
As a result, China posted a record trade surplus of $62.93 billion last month, the highest since Reuters started tracking the series in 1981, compared with the poll’s forecast for a $39 billion surplus and $45.34 billion surplus in April.
China’s trade surplus with the United States widened to $27.89 billion in May, Reuters calculation based on customs data showed.
· Oil climbs 5% on U.S. jobless drop, OPEC+ meeting hopes
Oil prices rose on Friday after an unexpected fall in the May U.S. jobless rate and OPEC’s decision to bring forward to Saturday discussions on whether to extend record production cuts.
Brent crude futures settled up $2.31, or 5.8%, at $42.30 a barrel, surging 19.2% on the week. U.S. West Texas Intermediate (WTI) crude futures rose $2.14, or 5.7%, to $39.55 a barrel, rising 10.7% on the week.
Brent has risen 17% since May 29 to reach a three-month high, in a range more comfortable for producers like Russia. The contract has more than doubled since crashing as low as $15.98 a barrel on April 22. WTI is up 11%.
Both benchmarks were headed for a sixth week of gains, lifted by the output cuts and signs of improving fuel demand as countries ease lockdowns imposed to fight the new coronavirus outbreak.
· OPEC, Russia extend record oil cuts to end of July
OPEC, Russia and allies agreed on Saturday to extend record oil production cuts until the end of July, prolonging a deal that has helped crude prices double in the past two months by withdrawing almost 10% of global supplies from the market.
The group, known as OPEC+, also demanded countries such as Nigeria and Iraq, which exceeded production quotas in May and June, compensate with extra cuts in July to September.
OPEC+ had initially agreed in April that it would cut supply by 9.7 million barrels per day (bpd) during May-June to prop up prices that collapsed due to the coronavirus crisis. Those cuts were due to taper to 7.7 million bpd from July to December.
· Protesters march again, demanding justice after George Floyd killing
A relaxed confidence infused a new round of street protests in New York and other major cities on Sunday, a day after some of the largest demonstrations since the killing of George Floyd in Minneapolis police custody unfolded with no major violence.
The near-festive tone of many of the weekend’s major U.S. rallies stood in sharp contrast to scenes of clashes, looting and vandalism earlier in the week that authorities and activists blamed largely on outside agitators and criminals.
· North Korea warns South Korea to stop defectors from scattering anti-North leaflets: KCNA
The sister of North Korea’s leader has warned South Korea to stop defectors from sending leaflets into the demilitarized zone separating the countries, saying it may cancel a recent bilateral military agreement if the activity persists.
Kim Yo Jong, who serves unofficially as Kim Jong Un’s chief of staff, issued the warning in a statement carried by state news agency KCNA on Thursday.
Reference: Reuters, CNBC
Thai
Eng