FX Update: The dollar has been traded mixed
FX Update: The dollar has been traded mixed, gaining versus the yen and Swiss franc, both of which have underperformed as safe haven premiums unwind following some conciliatory-sounding remarks from President Trump yesterday, while losing ground to the dollar bloc currencies and holding near net unchanged levels versus the euro. USD-JPY lifted 0.4% to an intraday high of 109.77, and EUR-JPY nearly 0.5%. EUR-USD held in a narrow range in the lower 1.1200s, remaining comfortably below yesterday's two-week high at 1.1263. Eurozone data today have included an as-expected 0.3% m/m contraction in March industrial production, while German ZEW investor confidence unexpectedly declined to -2.1 in the May reading from 3.1 in the previous month. ECB's Villeroy said that recent data underscore a "significant, but temporary slowdown" while caveating that "notwithstanding persistent and substantial geopolitical uncertainties." European stock markets and S&P 500 futures gained, and while Asian equity markets mostly showed declines, most pared steep losses seen in early trading. China's State Councillor Wang Yi said that both sides that have the "wisdom to resolve each other’s reasonable demands," though Beijing communicated via editorials in state-backed media a much tougher stance, blaming the trade war on "one person and his administration and asserting that the U.S. is misjudging China's "capability and willpower." Elsewhere, Sterling recouped lost ground after posting two-week lows versus the Dollar, and respective eight-week and four-month lows against the Euro and Yen. Cable's low is 1.2923, capping a quite-steep decline from the early May peak at 1.3176. UK labour data showed unemployment unexpectedly falling to 3.8% in March, which is the lowest rate seen since December 1974, though wage data weakened more than expected.