In the aftermath of Moody’s downgrading US debt, the dollar remained lower all throughout yesterday. 30-year treasury yields rose to 5.03% - the highest since 2023; but equities managed to claw back losses and finished the day higher. The EUR had a solid day on a combination of USD selling, as well as comments by European Cental Bank (ECB) President Lagarde that the recent rise of the euro is a consequence of Trump policies and is viewed as an opportunity rather than a concern for Europe.
*Daily move - against G10 rates at 7:00 am, 20.05.25
** Indicative rates - interbank rates at 7:00 am, 20.05.25
Markets are a bit mixed this morning, despite Trump stating that Russia and Ukraine will immediately start truce talks on ending the war. The dollar is slightly off this morning, despite 30-year treasury yields easing off of yesterday's high.
The Australian dollar is weaker this morning after the RBA interest rate decision was to cut rates by 25bps to 3.85%. The accompanying statement was taken as slightly more dovish than expected, with the Bank lowering GDP forecasts from 2.4% to 2.1%, and trimmed their CPI expectations from 2.7% to 2.6%.
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