Markets Steady, Busy Week Ahead
Markets should be ready to big volatility, as Trump-Kim summit and other high-risk events are expected, including FOMC, ECB, BoJ and Brexit vote. Since the US Federal Reserve will almost certainly raise interest rates for the second time this year, the focus of the market will be on the Fed's forecast of the future way of interest rates.
Both, the American and North Korean leaders, arrived in Singapore in preparation for their long-awaited, first historic meeting. Kim said that "the whole world was watching," while Trump said that he had a good idea of the summit. The editorial office of the official state newspaper of North Korea hinted at the possible "normalization" of American ties. The United States wants North Korea to abandon its nuclear weapons, but it is not clear that Pyongyang may want to replace it.
The US dollar fell, while safe-haven yen rose today after US President Donald Trump left the G7 Summit early. The G-7 Summit, held in Canada, revealed a deep split in trade and tariffs between Trump and other leaders, as the US President refused a joint communique and attacked the Prime Minister of Canada, Trudeau.
The USD/JPY pair gained 0.18% to 109.75. However, the market reaction was considered moderate since few traders had expected a meaningful agreement on trade to be reached at the G7.