• Gold down $16 to $1940
  • WTI crude oil down $2.39 to $71.95
  • US 10-year yields up 10 bps to 3.82%
  • S&P 500 up 24 points to 4160
  • USD leads, NZD lags

Strong signs that a debt ceiling deal is near combined with a surge of inflows into US tech stocks led to another strong day for the US dollar as it breaks out against the yen, New Zealand dollar and others.

USD/JPY took out the 140.00 barrier late in the day and continued another 20 pips higher. The pair had started New York trade down 25 pips but added 100 pips from there. Better US initial jobless claims and stronger GDP helped as well.

Elsewhere the US dollar was strong but not quiet as fierce. EUR/USD fell 28 pips on the day but the lows were set early in US trade and it was mostly sideways from there. Cable made new lows later despite some more-hawkish comments from Haksel but 1.23 has held so far.

NZD/USD remains in a bad spot after yesterday's dovish RBNZ comments. Buyers are finding it tough to nail down any support, though there have been some small bids at 0.6040.

The Canadian dollar was hit by falling oil prices as USD/CAD rose sharply for the second day. There's some resistance at 1.3650 and that's holding so far but will be a spot to watch on Friday.

Note that the upcoming Monday is a holiday in the US so it will be a de facto shortened trading day on Friday, including an early close in the bond market.

FX news wrap May 25