- Xi Jinping and Trump have a phone call
- Canada and US employment reports on tap
- US dollar opens with small gains from Thursday close.
USDCAD open 1.3678, overnight range 1.3661-1.3687, close 1.3676, WTI 63.22, Gold 3357.26
The Canadian dollar traded sideways overnight in an uneventful session ahead of the US and Canadian employment numbers for May.
Canada’s May employment report is expected to disappoint, with an estimated loss of 15,000 jobs—partly election-related—and a rise in the jobless rate to 7.0% from 6.9%.
The US numbers tell a different story. This week’s employment indicators point to a cooling labor market, and today’s non-farm payrolls data is expected to support that narrative. Forecasts call for a 130,000 increase in May jobs, down from April’s 177,000. If the unemployment rate holds at 4.2%, the Fed is likely to delay any rate cut until September.
The U.S. and Chinese presidents held a 90-minute call. Trump announced plans to visit China, and Xi Jinping has been invited to Washington. Trump also reversed the ban on Chinese student visas, while Xi confirmed China would resume rare earth exports under the May 12 agreement. Neither leader admitted to initiating the call.
Asian equity markets ended mixed, with Japan’s Topix climbing 0.42% and Australia’s ASX 200 slipping 0.27%. European bourses are flat to lower, while S&P 500 futures have gained 0.36%. The U.S. 10-year Treasury yield sits at 4.384%, and spot gold (XAUUSD) trades at $3,363.70.
EURUSD traded in a 1.1411–1.1458 range, initially rallying to 1.1495 after the ECB delivered a widely expected 25 bp rate cut before retreating as policymakers downplayed the chances of another move in July. Uncertainty tied to tariffs remains a wildcard. Traders shrugged off stronger-than-expected Eurozone GDP data (1.5% q/q vs. 1.2% forecast). Market focus is now squarely on the U.S. payrolls report and $2.4 billion in 1.1400 options expiring at 10 a.m. ET.
GBPUSD traded in a 1.3529–1.3585 band, sliding during Asian and European sessions before bouncing modestly in early New York action. Softer UK house price data weighed on sentiment, while traders await direction from U.S. employment figures.
USDJPY moved in a 143.45–144.19 range, climbing steadily after a disappointing April household spending report in Japan, which showed a 0.1% y/y drop versus forecasts for a 1.4% gain. The yen also weakened on unwinding of safe-haven flows following signs of U.S.–China diplomatic thaw.
AUDUSD stayed within a 0.6486–0.6518 range, trading with a bearish bias as the U.S. dollar firmed in response to news of the Trump–Xi conversation and improved risk sentiment.
NZDUSD traded between 0.6022 and 0.6051, echoing AUDUSD moves as traders remained cautious ahead of the U.S. jobs report, with broad greenback strength pressuring the kiwi.
