AUSSIE 10-YEAR TECHS: (U5) Rolling Off Highs

TYU5 reopens at 110-06, up 0-01 from closing levels in today’s Asia-Pac session.

• Overnight the US 10-year yield had a range of 4.4678% - 4.5156%, closing around 4.47%. 
• Treasury yields ended lower overnight, led by the short-end the yield curve ended slightly steeper(2s10s +0.34 at 46.832, 5s30s +1.08 at 85.589).
• MNI US DATA: NY Fed: Consumers Less Pessimistic On Jobs, Finances .The vast majority of Labor Market and Household Finance categories in the NY Fed's Survey of Consumer Expectations (SCE) improved in May, though many remain weaker compared with late 2024/early 2025 as tariff uncertainty appears to continue in respondents' minds.
• MNI US DATA: NY Fed Consumer Inflation Concerns Ease In May. The New York Fed's Survey of Consumer Expectations (SCE) showed an improvement across the board in May, with respondents both less pessimistic on economic prospects and less concerned about future inflation compared with April.
• The 10-year yield held its support around the 4.35% area last week. While this level holds focus will remain on potentially extending higher, CPI tomorrow will be a very important input.

The AUD had a range overnight of 0.6506 - 0.6534, Asia is opening around 0.6515. The AUD has managed to hold above 0.6500 as US stocks continue to press higher and the USD remains under pressure. Traders will be watching for a sustained move back above 0.6550 but with US CPI tomorrow it might have to wait a little longer.

• (Bloomberg) -- “Australia’s securities regulator said it will begin testing a more streamlined process for local IPOs to encourage listings. The trial aims to reduce the typical 20-week timeline by about one week.”
• MNI US TSYS: US Marines Deployed to Los Angeles. Muted reaction so far, stocks pared gains after wires reported a battalion of Marines (appr 500) to be deployed to Los Angeles. 
• The AUD found decent demand back towards the 0.6500 area overnight as the market eyes a potential extension higher.
• Price remains in the 0.6350 - 0.6550 range, a sustained break above 0.6550 is needed for the move higher to accelerate. Price looks set to test the top end of the range but I am not sure how far it extends until we get US CPI tomorrow out the way.
• Expect buyers to continue to be around on dips while the support in the AUD holds, a close back below 0.6350 is needed to challenge the newly formed uptrend. 
• Options : Closest significant option expiries for NY cut, based on DTCC data: 0.64200(AUD771m)/ 0.6460(AUD 529m). Upcoming Close Strikes : 0.6350(AUD 711m June 12), 0.6600(AUD643m June 12)
• CFTC Data shows Asset managers maintaining their shorts, the Leveraged community though continued to add to their shorts again.

• Data/Event: Westpac Consumer Confidence, NAB Business Confidence

  Fig 1: AUD CFTC Data

  

  Source: MNI - Market News/Bloomberg Finance L.P

Spot USD/CNH tracks near 7.1830 in early Tuesday dealings. We sit around 100pips lower from early Monday Asia Pac highs, but found support on dips under 7.1800 during yesterday's session. Broader USD indices finished down for Monday trade, the BBDXY index off 0.20% to 1209.25, not too far from pre NFP levels last Friday. Spot USD/CNY finished up at 7.1794. The CNY CFETS basket tracker finished up at 95.79, +0.22%, (per Bloomberg), so slightly up from recent cycle lows. 

• Focus remains on the US-China trade talks. Bloomberg reported: "US-China trade talks in London will continue tomorrow, according to a person familiar with the talks. Talks to resume at 10a in London" [0500ET]. Today's meeting began just after 1pm local time (0800ET), though there were basically no headlines emerging from the talks themselves. Little market reaction to the news that talks would continue - an extension into Tuesday was seen as a distinct possibility.
• Earlier it was reported that President Trump had authorized Treasury Secretary Scott Bessent's team to negotiate away recent restrictions on the sale of a wide variety of technology and other products to China, according to people familiar with the matter. This aided broader risk sentiment, although US and EU equity indices finished mixed.
• The China Golden Dragon Index rose 2.07% in US trade on Monday, up in 5 out of the last 6 sessions. China's mainland CSI 300 index rose a more modest 0.29% yesterday. The China to global equity ratio is back up from earlier June lows, but CNH isn't following this trend so far.
• For USD/CNH we remain within recent ranges, the 20-day EMA is just under 7.2000 in terms of topside resistance. On the downside, earlier June lows were at 7.1645.
• The local data calendar has May new loans/aggregate finance figures due June 10-15, otherwise it is light data wise.