The dollar edged higher in early European trade Tuesday, but activity remains subdued ahead of this week’s key U.S. inflation release after Friday’s lackluster payrolls number.
At 2:55 AM ET (0755 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was up 0.2% at 90.093, not far above 89.533, a 4 1/2-month low touched late last month.
EUR/USD traded 0.1% lower at 1.2177, still above its three-week low of 1.2104 set on Friday, while USD/JPY gained 0.2% to 109.48, after Japan’s GDP contracted 1% quarter-on-quarter and 3.9% year-on-year for the first quarter of 2021. GBP/USD fell 0.2% to 1.4150 and the risk-sensitive AUD/USD was down 0.1% at 0.7745.
Friday’s U.S. nonfarm payrolls release showed an increase of 559,000 jobs last month after a revised 278,000 gain in April, below the 650,000 gain expected.
Oil was down Tuesday morning in Asia, continuing Monday’s losses as the fragile state of the global economic recovery from COVID-19 impacts the fuel demand outlook.
Brent oil futures fell 0.77% to $70.94 by 11:38 PM ET (3:38 AM GMT), but remained above the $70-mark. WTI futures were down 0.74% to $68.72.
Investor worries were heightened by trade data from China, the world’s top oil importer, released on Monday. Imports grew 51.1% year-on-year in May, below the 51.5% in forecasts prepared by Investing.com but higher than April’s 43.1% growth.
“Chinese oil imports at a five-month low… would tend to confirm weakness in the Asia market,” Mizuho Securities director of energy futures Bob Yawger told Reuters.
Investors also await the outcome of talks between Iran and world powers to revive a 2015 nuclear deal and potentially re-add Iranian crude to the global supply. Discussions are scheduled to resume in Vienna on Jun. 10.
Apple Inc (NASDAQ:AAPL) is in early-stage talks with China’s CATL and BYD about the supply of batteries for its planned electric vehicle, four people with knowledge of the matter said.
The discussions are subject to change and it is not clear if agreements with either CATL or BYD will be reached, said the people who declined to be named as the discussions are private.
Apple has made building manufacturing facilities in the United States a condition for potential battery suppliers, said two of the sources.
CATL, which supplies major car makers including Tesla (NASDAQ:TSLA) Inc, is reluctant to build a U.S. factory due to political tensions between Washington and Beijing as well as cost concerns, the two people said.
It was not immediately clear if Apple is also talking to other battery makers.
Apple, which has yet to make a public announcement about its car plans, declined to comment. CATL, the world’s biggest automotive battery maker, and BYD, the world’s No. 4, also declined to comment.
Legal disclaimer: The material does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instruments. UR Trade Fix Ltd accepts no responsibility for any use that may be made of these comments and for any consequences resulting in it. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. The analysis does not involve any specific investment objectives, financial situation and needs of any specific person who may receive it. Past performance does not constitute a reliable indicator of future results and future forecasts do not constitute a reliable indicator of future performance.
It has not been prepared in accordance with legal requirements designed to promote the independence of research, and as such it is considered to be marketing communication. Although we are not specifically constrained from dealing ahead of the publication of our research, we do not seek to take advantage of it before we provide it to our clients. We aim to establish, maintain and operate effective organizational and administrative arrangements with a view to taking all reasonable steps to prevent conflicts of interest from constituting or giving rise to a material risk of damage to the interests of our clients. We operate a policy of independence, which requires our employees to act in our clients’ best interests when providing our services