· The dollar opened the week by sliding against other Asian currencies, giving up gains from last week.
After rising to this year’s high of 94.21 on Friday, the U.S. dollar index, which measures the value of the dollar against a basket of six major currencies, fell during Monday morning trade in Asia as the market dealt with the developments over a U.S.-North Korea summit.
The U.S. dollar index stood at 93.87, down 0.36%, at 11:42PM ET (03:42 GMT).
The USD/JPY pair gained 0.02% to 109.40. While the pair was rising slightly in late morning, risk aversion increased demand for the yen overall. Investors who bought the yen to avoid risks could sell out the currency if tensions between the U.S. and North Korea ease.
· Italian bonds, stocks and the euro rallied on Monday after Italy’s president rejected a eurosceptic pick for the key role of economy minister prompting anti-establishment parties 5-Star Movement and League to abandon plans to form a government.
Italy’s president Sergio Mattarella is expected to ask a former International Monetary Fund official on Monday to head a stopgap government amidst political and constitutional turmoil, with early elections looking inevitable.
The euro EUR=EBS rallied 0.6 percent to $1.1728, pulling itself above 6-1/2 month lows. It strengthened 0.8 percent against the Swiss franc EURCHF=EBS , bouncing sharply from near 3-month lows.
Italian 10-year government bond yields dropped 10 basis points to 2.35 percent in early trade IT10YT=RR while two-year yields dropped as much as 14 bps IT2YT=RR and was set for its biggest daily drop in three years.
· Two U.S. Navy warships sailed near South China Sea islands claimed by China on Sunday, two U.S. officials told Reuters, in a move likely to anger Beijing as President Donald Trump seeks its continued cooperation on North Korea.
· A veteran market researcher is out with a warning — saying the Federal Reserve is relying too heavily on economic surveys skewed by social media to mold their policies.
· Oil prices fell on Monday, extending even steeper declines from Friday, as Saudi Arabia and Russia said they may increase supplies and as U.S. production gains show no signs of abating.
Brent crude futures LCOc1 were at $75.70 per barrel at 0655 GMT, down 74 cents, or 1 percent, from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at $66.78 a barrel, down $1.1, or 1.6 percent.
Brent and WTI have fallen by 6 percent and 8.3 percent respectively from peaks touched earlier in May.
Reference: Reuters, CNBC
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