· The euro won a reprieve on Thursday, holding on to the strong gains it made on Wednesday, as Italian leaders moved to mitigate political turbulence and avoid a potentially disruptive early election.
The euro traded little changed at $1.1654, having risen 1.1 percent the previous day, its second-biggest daily gain so far this year. It had hit a 10-month low of$1.1510 on Tuesday.
The two-year Italian government bond yield fell to 1.75 percent on Wednesday from 2.71 percent the previous day.
But others remained more cautious.
· U.S. regulators on Wednesday proposed simplifying a rule introduced after the 2007-2009 financial crisis that bans banks from trading on their own account in order to make compliance easier for many firms.
The rewrite of the so-called Volcker Rule marked another step by regulators under U.S. President Donald Trump to ease rules introduced by the 2010 Dodd-Frank financial reform law in a bid to boost lending and economic growth.
Foreign banks and funds are set to benefit from a move by U.S. regulators on Wednesday to simplify a trading rule that foreign banks and regulators say has inadvertently ensnared firms operating as far afield as Europe and Asia.
Foreign banks have often complained that the Volcker Rule improperly affects their non-U.S. operations because it broadly applies to any foreign bank that has a relationships with a U.S. entity or affiliate.
· Washington will announce plans to slap tariffs on EU steel and aluminum imports as early as Thursday morning, sources said, while the U.S. commerce secretary said any escalation of their trade dispute would depend on the bloc’s reaction.
· Washington does not want a trade war with the European Union, but whether there is an escalation or not will depend on the EU, U.S. Commerce Secretary Wilbur Ross said in an interview published by daily Le Figaro on Thursday.
· U.S. Secretary of State Mike Pompeo and high-ranking North Korean official Kim Yong Chol enter a second day of meetings in New York on Thursday as they try to settle nuclear weapons disagreements and set the stage for an historic summit between their two leaders.
· The current outlook for growth is bright, but specific risks could endanger long-awaited progress, according to a report released Wednesday by the Organization for Economic Cooperation and Development (OECD).
· President Bashar al-Assad said the United States should learn the lesson of Iraq and withdraw from Syria, and promised to recover areas of the country held by U.S.-backed militias through negotiations or force.
· Two polls show that between 60-72 percent of Italians want the country to remain part of the euro while 23-24 percent would choose to drop the common currency.
· Japan’s industrial output was well short of market expectations in April, official figures showed on Thursday, adding to fears for the outlook after the economy contracted in the first quarter.
Industrial output rose just 0.3 percent in April from the previous month, official data showed on Thursday, well below the median forecast for a 1.2 percent increase and a 1.4 percent rise in March.
Much of the slowdown was due to a 5.6 percent decline in production of electronic parts while inventories rose for a third straight month, adding to fears of weakening overseas demand.
· The United States’ measures against China’s investments are against World Trade Organization rules, and China reserves the right to take countermeasures, the commerce ministry said on Thursday.
China is not willing to see an escalation in Sino-U.S. trade frictions, and believes the two countries have a huge potential for cooperation, Ministry of Commerce spokesman Gao Feng told reporters at a regular news briefing.
· China’s vast manufacturing sector grew at the fastest pace in eight months in May, blowing past expectations and easing concerns about an economic slowdown even as risks from trade tensions with the United States and a crackdown on debt point to a bumpy ride ahead.
The official Purchasing Managers’ Index (PMI) released on Thursday rose to 51.9 in May, from 51.4 in April, and remained well above the 50-point mark that separates growth from contraction for the 22nd straight month.
· North Korea’s state-run news agency said Russian Foreign Minister Sergei Lavrov arrived in the North on Thursday at the invitation of North Korean Foreign Minister Ri Yong Ho.
The report did not elaborate on what Lavrov would be doing during his visit in North Korea.
· Oil prices eased slightly on Thursday following a rally in the previous session, as investors eyed a surprise increase in U.S. crude oil inventories and looked to a possible rise in output when OPEC and other producers meet in June.
Brent crude was down 38 cents, or 0.5 percent, at $77.12 per barrel at 0643 GMT, after settling the last session up 2.8 percent.
U.S. West Texas Intermediate crude was down 20 cents, or 0.3 percent, at $68.01 a barrel. In the previous session, it settled up $1.48, or 2.2 percent, at $68.21 per barrel.
· Russia would be able to raise its oil output back to pre-cut levels within months if there is a decision to unwind the price-protection deal with OPEC and other producers, a Russian energy ministry official said.
Russia and OPEC leader Saudi Arabia have talked of a gradual increase in output as the goal of removing excessive oil stockpiles has been achieved and the market is broadly balanced after producers last year began withholding 1.8 million barrels per day (bpd) to tighten the market and prop up prices.
Reference: Reuters, CNBC
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