· The dollar slid against the safe-haven Japanese yen on Friday as dismal U.S. manufacturing data fueled worries about the wider economy, and bond yields signaled growing fears of a recession.
The dollar, however, rose against the euro as a much weaker-than-expected German manufacturing survey raised concerns that Europe's powerhouse economy may be slowing.
· On Friday, the spread between three-month Treasury bills and 10-year note yields inverted for the first time since 2007 after U.S. PMI manufacturing data missed estimates. This inversion of the yield curve is widely seen as a leading indicator of recession.
· "You have to take it seriously that it is a signal for slowing growth or a potential recession in the next 12 to 18 months. This is what the Fed looks at closely," said Sean Simko, head of global fixed income management at SEI Investments Co in Oaks, Pennsylvania.
· The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.634 after bouncing from lows below 96.3 in the previous session.
The Japanese yen, widely viewed as a safe-haven currency, traded at 110.11 against the dollar after strengthening from lows above 110.6 last Friday.
Meanwhile, top U.S. officials from Washington are also set to visit Beijing later this week to resume trade negotiations with China.
· China and the U.S. are expected to strike a deal sometime in April, with the uncertainty surrounding the trade fight between the two economic powerhouses weighing on investor sentiment for much of 2018.
· The U.S. and China could reach a trade agreement in a matter of weeks, but that's unlikely to improve relations between the two economic giants over the longer term, according to former U.S. diplomat.
The two largest economies in the world have been trying to negotiate a trade deal to iron out their differences on issues such as the forced transfer of technology from American firms to China, Beijing's subsidies for its domestic companies, and a trade imbalance between China and the U.S.
"I think we'll see a deal — I think both countries understand that it's in each of their best interests. I expect something to be done in the next four to six weeks," Kurt Campbell, chairman and chief executive of advisory firm The Asia Group, told CNBC's Martin Soong on Sunday at the China Development Forum in Beijing.
· Attorney General William Barr said Sunday that special counsel Robert Mueller’s Russia investigation did not find sufficient evidence to establish that President Donald Trump committed an obstruction of justice offense, or that the president’s campaign coordinated with Moscow’s efforts to influence the 2016 election.
President Donald Trump claims “complete and total exoneration” from Attorney General William Barr’s summary of special counsel Robert Mueller’s Russia investigation report.
In fact, Mueller writes that his probe “does not exonerate” the president.
Barr notes, though, that he and Deputy Attorney General Rod Rosenstein “have concluded that the evidence developed during the Special Counsel’s investigation is not sufficient to establish that the President committed an obstruction-of-justice offense.”
· Britain must find a way to leave the European Union in an orderly fashion rather than trying to oust Prime Minister Theresa May, finance minister Philip Hammond said on Sunday.
When asked by Sky about newspaper reports of a plot to oust May by senior ministers and whether she had run out of road, Hammond said: "No. I don't think that is the case at all."
"Changing prime minister wouldn't help us," he said. "To be talking about changing the players on the board, frankly, is self-indulgent at this time."
· Oil fell more than 1 percent on Friday, slipping further from 2019 highs as focus shifted to a lack of progress in U.S.-China trade talks and as grim manufacturing data from Germany and the U.S. reignited fears of a slowdown in the global economy and oil demand.
Wall Street's main indexes tumbled more than 1 percent on Friday after manufacturers in Europe, Japan and the United States suffered in March as surveys showed trade tensions had impacted factory output, a setback for hopes the global economy might be turning the corner on its slowdown.
Brent crude futures were at $66.96 per barrel, down 1.3 percent. The contract hit a four-month high of $68.69 on Thursday.
The global benchmark has risen by more than 20 percent since the beginning of January, due to supply cuts by the Organization of the Petroleum Exporting Countries and allies, such as Russia, and U.S. sanctions on Iran and Venezuela.
U.S. West Texas Intermediate (WTI) futures settled down 1.6 percent at $59.04 per barrel. WTI marked a 2019 peak on Thursday at $60.39 and is roughly flat on the week.
"Today's disappointing PMI data out of Germany and France spurred further dollar gains while, at the same time, compressing global risk appetite," said Jim Ritterbusch, president of Ritterbusch and Associates.
Reference: CNBC, Reuters
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