11th June, 2025

The USD is largely a little firmer across the board, with USD/YEN trading tentatively north of 145.00.

Latest moves coincide with a a federal appeals court holding US President Trump can continue to enforce his global tariffs for now.

Meanwhile, the US and China agreed to a preliminary plan to ease trade tensions, which could revive the flow of sensitive goods between the world’s two largest economies. US negotiators reportedly expect issues including rare earths to be resolved.

But, all US stock futures sit light in the red at the time of writing, led by the 0.3% NASDAQ, and Saxo Markets suggest the absence of further meetings signals that we’re not out of the woods yet.

This session, US CPI for May is standout event.

It pretty much has the floor.

Headline CPI is forecast a touch higher at 2.4% y/y and the core to 2.9% y/y vs 2.3% and 2.8% respectively. These both from cyclical lows though.

Ahead, Bbg remarks traders have boosted bets that the Fed will cut interest rates only once this year.

We also get Canada building permits in the second half of the session.

ECB's Cipollone and Lane are scheduled speakers, while the Bank's wage tracker will also garner some interest.

Overnight, Lagarde remarked being a bully on trade won't work longer-term. The ECB President suggested protectionism erodes the foundations of global prosperity and provokes retaliation, leading to mutually damaging outcomes.

It is also UK spending review day.

And, BBC News reports Chancellor Rachel Reeves will deliver her Spending Review later, setting out the budgets for all government departments over the next few years.

The NHS and defence are expected to get the biggest boost when Reeves lays out how taxpayers' money will be spent at 12:30 BST. She is also expected to announce Gbp 39bln to help build social and affordable housing over the next 10 years, as well as extending the Gbp 3 bus fare cap in England until 2027. The IFS warn, however, that sharp trade-offs are unavoidable.

Elsewhere, a Bbg survey showed a majority of BOJ watchers expect officials to slow their pace of reductions in government bond buying and all 53 respondents see the Bank keeping interest rates unchanged at next week’s policy meeting.

Bbg notes respondents pushed back their call for the next move in the policy rate. January is now the most popular month, with 34% predicting a hike then, up from 15% ahead of the May meeting. Around 30% of analysts see October as most likely, while those expecting a July hike dropped to 8% from about 25% in May's survey.