Summary:

• Agricultural commodities surge

• Polish equities outperform other European peers

• BITCOIN retreats from $8500 handle

With almost empty calendar Monday’s early trading was rather calm. In Europe equities broadly advance with Polish stocks being top performers in the region. One should keep in mind that trading during European session can be a little subdued due to the lack of German traders. On the commodity front we observe a surge in the agricultural goods prices. Cotton adds as much as 2.3% followed by the 1.75% advance of soybeans. Japanese yen and British pound are the biggest underperformers in the G10 basket, while Australian dollar and Norwegian krone are in the most superb condition.

Wednesday has two big ticket calendar positions for the EURUSD. One is the FOMC minutes. A surge in US Treasury yields (and a corresponding decline in TNOTE) has been arguably the major driver behind USD resurgence and it helped drive EURUSD significantly lower.

According to a Chinese government-backed industry organization as much as 421 cryptocurrencies were identified as fake in April, while 60% of them had been deployed overseas. The agency underlined that “some criminals are engaged in financial fraud or pyramid schemes under the cover of virtual currency”.

Trade negotiators from the US and China decided over the weekend to put a trade war on hold at least until a wider agreement was hammered out buoying stocks in Asia. Both sides agreed they will continue talking about measures under which China is to import much more from the US in order to lower a massive trade surplus it holds.

The Bank of England withdrew the only major reason for traders to be bullish GBP and we can see a lot of weakness on the pound. But could it get worse? A lot will depend on inflation that was at 2.5% in March for headline and 2.3% for the core measure. Data for April will be presented this Wednesday.