IRAN: U.S. Central Command @CENTCOM on X

• After some initial positive price action to start the week, firmer risk sentiment capped the USD’s momentum on Monday, with the DXY broadly consolidating around the 101 level. Despite a number of factors working against the dollar last week, including month-end flows, Chair Warsh rhetoric on inflation and the much softer-than-expected US employment report, the greenback is showing solid resilience overall.
• Dollar strength has been most notable against the Japanese yen, where underlying fundamentals have driven the USDJPY rebound back above 162.00. Technical sights are on key short-term resistance and the bull trigger at 162.84, the Jun 1 high. A break of this hurdle would confirm a resumption of the uptrend and open 163.75, the top of a bull channel drawn from the Feb 12 low.
• Relative outperformance for sterling has also assisted GBPJPY to fresh cycle highs, and the highest level since 2008 above 217.00. This dynamic has returned EURGBP to the recent lows, following its medium-term breakdown last week. 0.8508 remains the target here, ahead of the bear channel base just below 0.85.
• AUDNZD has also risen 0.4% back to 1.22 on Monday as traders focus their attention on Wednesday’s policy announcement by the RBNZ, where a consensus (16/22 economists) believe the OCR will be raised by 25bps to 2.5%.
• Japan’s 30 yr bond auction may garner attention overnight, before German IP and the BOE Financial stability review. US weekly ADP and trade data are then scheduled.

• Date $MM Issuer (Priced *, Launch #)
• 07/06 $3.25B #BFCM $1.35B 3Y +65, $400M 3Y SOFR+82, $1.5B 6NC5 +95
• 07/06 $2B *BMO 3Y SOFR+40
• 07/06 $1.75B #Nationwide $1B 6NC5 +85, $750M 11NC10 +105
• 07/06 $500M #KT Corp 3.5Y +55
• 07/06 $500M #CIBC 60.5NC5.5 6.75%
• 07/06 $Benchmark ENEL Finance 3Y +60, 5Y +78, 10Y +105
• 07/06 $Benchmark American Honda 3Y +70, 5Y +85, 7Y +95
• 07/06 $Benchmark Toyota Motor Credit 3Y +40, 3Y SOFR+58, 7Y +68
• 07/06 $Benchmark Energy Transfer LP 30NC5 6.55%, 30NC10 6.7%

Progressive former Wayne County health director Abdul El-Sayed is favoured to win the Democratic primary election for the Michigan Senate race, after early frontrunner state Sen. Mallory McMorrow (D) suspended her campaign on Sunday amid a drop in her polling.

• McMorrow’s exit sets up another confrontation between a rising anti-establishment bloc and the moderate wing of the party, represented in the Michigan race by Rep Haley Stevens (D-MI). If El-Sayed secures the nomination, it would mean that outsiders are on the ballot in two must-win Senate races for Democrats. The other being the Maine Senate race, where Graham Platner secured the nomination over Governor Janet Mills (D-ME). McMorrow’s withdrawal ensures that a primary debate tomorrow will now only feature Stevens and El-Sayed. The primary will take place on August 4.
• The Hill reports, “Whether Stevens or El-Sayed will clearly benefit more from McMorrow’s departure from the race is unclear. Minimal polling has been conducted evaluating voters’ second preference in the primary or who they would support in a hypothetical two-person race…
• “El-Sayed has been riding momentum recently, leading Stevens by about 8 points in Decision Desk HQ’s (DDHQ) polling average. A few polls have also shown him leading in a hypothetical general election matchup against former Rep. Mike Rogers (R-Mich.), the likely GOP nominee.” 

Figure 1: Michigan Democratic Senate Primary Winner

Source: Polymarket