SOUTH AFRICA: Positive Signals On SA-US Trade Talks Despite Oval Office Clash

Focus turns to the European Cash Equity Open given the upside Opening gaps in Futures.

• Calls: Estox 50: +2.08%, Dax: +2.70%, CAC: +1.44%, FTSE +1.25%, SMI +1.20%.

• While Trump provided some relief for the Dollar following his comment on Fed Chair Powell and potential trade talks with China, the Dollar is mostly mixed against G10s.
• The AUD and the Kiwi are the best early performer, Risk On tone led, up 0.74% and 0.39% respectively at present.
• On the flip side of the coin, the Swissy and the EUR are the early worst performer, albeit by 0.43% and 0.33% respectively.
• Regardless of some of the pullbacks for the Greenback, the bigger picture is that the Dollar is deep in the red against all G10, looking at the past 1 Month, 3 Months or even YTD, since Market Participants have looked for safer ground.
• AUDUSD sees Yesterday's print of 0.6439 as the immediate resistance, this was also its best print since December.

Modest hawkish adjustments in GBP STIRs this morning after U.S. President Trump pushed back against the idea that he is looking to fire Fed Chair Powell.

• Market is also accounting for more sanguine language on trade with China from the Trump administration (including comments from Trump & Bessent).
• BoE-dated OIS little changed to 2bp less dovish across ’25 contracts, showing 25.5bp of cuts for next month, 37bp through June, 57bp through August and 90bp through year-end.
• SONIA futures flat to -5.0.
• We have highlighted the potential for flattening of the gilt curve at the open following the DMO’s remit revisions (details in previous bullets), we will watch for any feed through into GBP STIRs.
• Flash PMIs headline the UK data calendar today, with BoE speak due from Pill (11:30 BST), Bailey (18:15 BST) & Breeden (19:00 BST) due throughout the day.