Themes

· General mood is “risk off”

· Citi Research Note calls for four 50bp rate hikes this year in the U.S.

· U.S. Michigan Sentiment (59.4) and Pending Home Sales (-4.1%) both weaker than expected

What’s Moving

After quiet sessions in Asia and Europe, currencies caught a little bit of movement in North America amid news of a Citi Research report calling for four 50bp rate hikes this year in the U.S. This saw yields surge, which prompted strong buying of Dollars against most of the majors.

The upside then stalled and pre-weekend position adjustment saw most currencies back to familiar levels. Oil was also firmer on the day which helped to support he AUD and CAD.

Thoughts

With little clear direction from U.S. trade on Friday and amid the usual expected quiet start to the week, we are anticipating a quiet session for currencies in Asia today. Add to this a clear lack of key local data today and we are expecting a sleeper of a session today.