US: FED Reverse Repo Operation

President Donald Trump’s approval remains relatively stable this week, according to Silver Bulletin’s tracker, but it could fall in the coming days as more surveys come through reflecting concerns over the economy and Trump’s standoff with the Supreme Court and Federal Reserve.

• Silver Bulletin notes: “Trump’s net approval ratings have held steady around -5.0 since April 9th. That’s exactly one week after his Liberation Day tariff announcements.”
• Reuters/Ipsos notes in a new survey out today: “Trump's public approval rating edged down to its lowest level since his return to the White House, as Americans showed signs of wariness over his efforts to broaden his power,”
• Gallup notes: “Public attitudes about several specific aspects of the U.S. economy have changed markedly in the short time Trump has been in office, as Americans’ expectations for the stock market, economic growth and employment have turned negative and consumers are feeling unusually pessimistic about their personal finances.”

Figure 1: Trump Approval Rating

Source: Silver Bulletin

• Monday’s sharp extension of greenback weakness prompted the USD index to print fresh 3-year lows below the 98.00 mark. Despite an initial selloff on Tuesday, these lows remained untested and the subsequent powerful rebound for risk sentiment has provided a solid boost to the dollar, rising against all G10 peers on the session as we approach the APAC crossover.
• Despite the meagre 0.3% advance on the session, a lot of the commentary has been centred around USDJPY, which briefly printed below the psychological 140.00 mark. The pair’s selloff did fall short of the September lows, located at 139.58 – as this area appears to have assisted the short-term recovery, with spot consolidating around the 140.70 mark for much of the session, before catching an additional bid on the latest Bessent headlines on a China deal being possible - to reach session highs above 141.30. Resistance remains much further out at 143.28 initially, the April 16 high.
• Low liquidity moves on Monday may have exacerbated the price action for the dollar, and the powerful turnaround for US equities on Tuesday might suggest that a lot of bad news was priced into the market, leaving the greenback susceptible to a short-term correction. USDCHF has risen 1.1% to 0.8180 in sympathy, while EURUSD has extended its pullback to 1.1435.
• The close linkage between US-tied assets means the higher beta currencies in G10 have relatively underperformed, with the likes of AUD, NZD and GBP remaining moderately lower on the Tuesday. It is worth noting that a negative close for GBPUSD today would halt a consecutive winning streak of ten days for the pair. Support will be found at the prior breakout at 1.3207.
• Wednesday’s calendar will be highlighted by flash European PMIs as markets also eagerly await any Fed speak following Trump’s vociferous attacks on the central bank.

• Tsy futures retreat slightly (TYM5 -1 at 110-25) after the latest $69B 2Y note auction (91282CMY4) tailed: 3.795% high yield vs. 3.790% WI; 2.52x bid-to-cover vs. 2.66x prior.
• Peripheral stats has Indirect take-up falls to 56.18% from 75.77% prior, directs surge to 30.08% vs. 13.58% prior, primary dealer take-up 13.74% vs. 10.65% prior.
• The next 2Y auction is tentatively scheduled for May 27.