Elon Musk says won't decommission Dragon spacecraftSpaceX’s Dragon spacecraft serves as the company’s main vehicle for transporting both astronauts and cargo into orbit. Backed by multibillion-dollar contracts with NASA, SpaceX regularly carries NASA crews to and from the International Space Station. These missions are key to helping the agency sustain a continuous human presence on the ISS through its planned retirement in 2030.Musk had earlier said he would decommission Dragon in light of Trump's statement's re cancelling contracts. This article was written by Eamonn Sheridan at www.forexlive.com.

The People's Bank of China (PBOC), China's central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a "band," around a central reference rate, or "midpoint." It's currently at +/- 2%.Previous close was 7.1790PBOC injected 135bn yuan via 7-day reverse repos at 1.40%291.1bn yuan mature todaynet drain is 156.1bn yuan This article was written by Eamonn Sheridan at www.forexlive.com.

NBC with the report citing Republican senators: Republicans shouldn't back away from looking at potential changes to Medicareexploring ideas to slash “waste, fraud and abuse” in Medicare, several senatorsthey’re open to looking at other programs, too Sen. Kevin Cramer, R-N.D., said they shouldn’t be afraid of cutting waste in Medicare “Why don’t we go after that? I think we should”More at that link. This article was written by Eamonn Sheridan at www.forexlive.com.

Japan finance minister Kato says monetary policy up to BOJ, when asked about US Treasury report on JapanEarlier:US Treasury says no other country manipulates their own currencyIn the report the U.S. Treasury Department urged the Bank of Japan to stay the course on monetary tightening, arguing that doing so would help correct the yen’s prolonged weakness and contribute to a more balanced trade relationship between the two countries. In its exchange-rate report to Congress, the Treasury said the BOJ’s policy decisions should be driven by Japan’s domestic economic conditions, including growth and inflation trends. A continued tightening path, it noted, would support a healthier exchange rate and facilitate needed structural adjustments in trade flows. The report also cautioned against using state-run investment funds—such as public pension schemes—as tools to influence the yen’s value. Instead, the Treasury emphasized that these vehicles should focus on risk-adjusted returns and portfolio diversification, not currency competitiveness. This article was written by Eamonn Sheridan at www.forexlive.com.

People's Bank of China USD/CNY reference rate is due around 0115 GMT.The People's Bank of China (PBOC), China's central bank, is responsible for setting the daily midpoint of the yuan (also known as renminbi or RMB). The PBOC follows a managed floating exchange rate system that allows the value of the yuan to fluctuate within a certain range, called a "band," around a central reference rate, or "midpoint." It's currently at +/- 2%. How the process works:Daily midpoint setting: Each morning, the PBOC sets a midpoint for the yuan against a basket of currencies, primarily the US dollar. The central bank takes into account factors such as market supply and demand, economic indicators, and international currency market fluctuations. The midpoint serves as a reference point for that day's trading.The trading band: The PBOC allows the yuan to move within a specified range around the midpoint. The trading band is set at +/- 2%, meaning the yuan could appreciate or depreciate by a maximum of 2% from the midpoint during a single trading day. This range is subject to change by the PBOC based on economic conditions and policy objectives.Intervention: If the yuan's value approaches the limit of the trading band or experiences excessive volatility, the PBOC may intervene in the foreign exchange market by buying or selling the yuan to stabilize its value. This helps maintain a controlled and gradual adjustment of the currency's value.Something is afoot at the Bank:What is the People's Bank of China planning? This article was written by Eamonn Sheridan at www.forexlive.com.

Tariff negotiations between the U.S. and Japan are being complicated by the involvement of three senior American officials who hold conflicting views on trade, according to sources close to the talks. The differing approaches of Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and U.S. Trade Representative Jamiesol Greer have created confusion and made it difficult for Japanese negotiators to gauge the Trump administration’s true position.Tensions among the U.S. team have at times spilled into the open. One source said that at a recent meeting, the three cabinet members paused discussions with their Japanese counterparts to argue among themselves, further highlighting the internal discord shaping the negotiations.-Info via Japanese mediaEarlier on these talks:Is Japan about to do it own tariff taco? Ishiba to ease demand for US auto tariff repeal? This article was written by Eamonn Sheridan at www.forexlive.com.

Japan is softening its stance on the 25% U.S. auto tariff, according to the Asahi newspaper, and is no longer pushing for a full repeal. Instead, Tokyo is proposing a more flexible framework that would see tariff rates reduced depending on how much a country contributes to the U.S. auto sector.The proposal, reportedly put forward by Japan’s chief tariff negotiator Ryosei Akazawa—currently in Washington for a fifth round of trade talks—would tie tariff relief to metrics such as the number of vehicles Japanese carmakers build in the U.S. and how many are exported from the U.S. to global markets. Akazawa is meeting with senior U.S. officials, including Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, as part of ongoing negotiations.This shift in approach reflects Japan's effort to strike a more pragmatic deal, aligning with broader U.S. goals of strengthening domestic manufacturing while seeking tariff relief for its automakers.Reuters conveying the report from Asahi This article was written by Eamonn Sheridan at www.forexlive.com.

Consensus estimate +130K Estimate range +75K to +190KApril was +228K Private consensus +120K versus +167K priorUnemployment rate consensus estimate 4.2%Prior unrounded unemployment rate 4.1872% versus 4.1519% priorPrior participation rate 62.6%Prior underemployment U6 7.8% Avg hourly earnings y/y exp +3.7% versus +3.8% priorAvg hourly earnings m/m exp +0.3% versus +0.2% priorAvg weekly hours exp 34.3 versus 34.3 priorNumbers released so far this month:ADP report +37K versus +62K prior (lowest in two years)ISM services employment 50.7 vs 49.0 priorISM manufacturing employment 46.8 vs 46.5 priorChallenger job cuts 93.8K vs 105.4K prior Philly employment +16.5 vs +0.2 priorEmpire employment -5.1 vs -2.6 prior Initial jobless claims survey week 226K vs 216K priorI noticed that HFE -- which is a firm I really respect -- is at the high end of forecasts at +181K. They often spot seasonal quirks and that might be the case here.In general, there is some modest seasonal strength in the report with it coming above estimates 54% of the time, though the downside misses have been big when they've missed. In terms of the unemployment rate, 44% have been lower while 40% have been higher with the remainder matching the estimate.Overall, I don't think this is a particularly important report given that the Fed is in 'wait and see' mode. This article was written by Adam Button at www.forexlive.com.

Japan data - April household spending, a substantial miss both y/y and m/m:-0.1% y/y expected +1.4%, prior +2.1%-1.8% m/mexpected -0.8%, prior +0.4%Household spending is not benefitting from real wages continuing to fall in Japan. Pay is failing to keep up with inflation, which has been marked by soaring food prices:Japan April inflation adjusted wages -1.8% y/y, down for a fourth month This article was written by Eamonn Sheridan at www.forexlive.com.

Iran has reportedly placed large orders for ballistic missile components from China, according to sources familiar with the matter, as it works to strengthen its military capabilities while engaging in nuclear discussions with the U.S.The shipments, which include tons of ammonium perchlorate—a key propellant for missiles—are expected to arrive in Iran in the coming months. Sources say the materials could support the production of hundreds of ballistic missiles, with some potentially diverted to allied groups in the region such as Yemen’s Houthis.As nuclear talks with the Trump administration remain tense, Iran is simultaneously building up its regional influence and weapons stockpiles. It continues to increase its reserves of highly enriched uranium and has dismissed the idea of negotiating any constraints on its missile development program.Wall Street Journal (gated) with the report. This article was written by Eamonn Sheridan at www.forexlive.com.

Australian PM Albanese Will not loosen any rules regarding biosecurity during trade talks with United StatesAlbanese is fresh off a landslide election win. He won't be chickening out. This article was written by Eamonn Sheridan at www.forexlive.com.

Merz spoke with CNN earlier:German Chancellor Merz told CNN that Europe is seeking greater independence from ChinaSpeaking with Fox now:US tariffs are threatening our economyWe are looking for ways to bring them downMerz not the only one frustrated with tariffs: This article was written by Eamonn Sheridan at www.forexlive.com.

German Chancellor Friedrich Merz has signalled a strategic shift in Europe's economic approach, telling CNN that the continent is actively seeking greater independence from China. The remarks reflect growing concerns in Berlin and Brussels over the risks of overreliance on Chinese supply chains, particularly in critical sectors like technology and clean energy. Merz stressed that this push for diversification is not about economic decoupling but rather about building resilience and reducing vulnerabilities.The Chancellor also voiced strong concern over the impact of trade tensions, warning that tariffs are inflicting "terrible" damage on Germany’s flagship auto industry. With German automakers heavily exposed to global supply chains, rising protectionism is posing a significant threat to growth and competitiveness. Merz’s comments add to mounting pressure on the EU to respond strategically to the evolving global trade landscape.On the diplomatic front, Merz revealed that the German Chancellery and the White House have agreed to deepen their coordination on trade policy. The pledge for closer cooperation comes as both sides face common challenges from Beijing’s industrial policies and confront the broader task of maintaining a level playing field in global commerce. This article was written by Eamonn Sheridan at www.forexlive.com.

The news that Japan is poised to allow Real Estate Investment Trusts (REITs) to include data center equipment in their portfolios is not new. It was flagged earlier. NTT DATA announced plans for a domestic data center-specialized REIT around this time in 2024. It was set tp launch by March 2026. The REIT inclusion would likely make it easier for companies to raise capital for data center projects. This article was written by Eamonn Sheridan at www.forexlive.com.

Did anyone see the news flash across the screens late in the day in China on Thursday?All there was is that the People's Bank of China is holding a 'work meeting'. I saw nothing further despite digging around China sites etc. A "work meeting" held by the People's Bank of China (PBOC) refers to a formal internal conference where the central bank reviews its recent activities, assesses current economic and financial conditions, and outlines policy priorities for the upcoming period. These meetings are typically convened semi-annually or annually and are attended by senior PBOC officials, including the Governor, as well as representatives from related institutions such as the State Administration of Foreign Exchange (SAFE). The agenda often includes discussions on monetary policy adjustments, financial market stability, risk management, and the implementation of directives from higher authorities like the Communist Party of China (CPC) Central Committee and the State Council.For instance, during the 2024 Semiannual Work Conference, the PBOC emphasized the importance of maintaining a prudent monetary policy that is flexible and effective. Key actions included reducing the required reserve ratio and interest rates to support economic growth, enhancing financial support for sectors like technology innovation and affordable housing, and promoting the international use of the Renminbi (RMB). The conference also highlighted the need to balance short-term economic stabilization with long-term financial reforms, ensuring that the financial system contributes to high-quality economic development and national financial security.These work meetings are significant as they provide insights into the PBOC's strategic direction and policy intentions. While the PBOC does not always follow a predictable schedule for policy announcements, the outcomes of these meetings can signal upcoming monetary policy shifts, regulatory changes, and the central bank's approach to managing economic challenges. Observers and market participants closely monitor the statements and decisions emerging from these conferences to gauge the future trajectory of China's monetary and financial policies.I'll be keeping an eye and ear out for anything further. Perhaps it was something related to this:China expected to announce 'major financial polices' on June 18 and 19, 2025 This article was written by Eamonn Sheridan at www.forexlive.com.

Musk-Trump feud is bringing forth some fresh information and opinions. Trump named in the Epstein files:And now Trump's tariffs will bring on a US recession. This article was written by Eamonn Sheridan at www.forexlive.com.

Trump says call with Xi 'reached a very positive conclusion'Trump says call with Xi went 'very well'Xi: China and US agree to start a new round of trade talksThe Trump-Musk divorce is officialElon takes off the gloves: Says Trump is in the Epstein filesUS initial jobless claims 247K vs 235K expectedUS April trade balance -61.6B vs -70.0B expectedCarney and Trump are holding secret talks, US ambassador saysECB cuts key rates by 25 bps in June monetary policy decision, as expectedECB's Lagarde: The services sector is slowingLagarde: We are getting towards the end of the easing cycleECB sources: a 'visible majority' in ECB meeting expressed preference for holding in JulyECB officials expect rate cuts to be paused in July - reportFed's Kugler: I continue to support maintaining rate if upside inflation risks remainAtlanta Fed GDPNow 3.8% vs 4.6% priorCanada April trade balance -7.14 billion vs -1.50 billion expectedUS Q1 unit labor costs revised +6.6% vs +5.7% expectedUS Challenger May layoffs 93.82k vs 105.44k priorMarkets:US 10-year yields up 3.4 bps to 4.39%WTI crude oil up 52-cents to $63.37S&P 500 down 0.5%Gold down $19 to $3356AUD leads, JPY lagsWhat a day.The market moves aren't anything dramatic but the newsflow was memorable. It started with news from Chinese media that Trump and Xi were on a phone call, something that most were expecting to happen on Friday. That boosted sentiment and we anxiously awaited the readouts. When they came there was some disappointment at the lack of real action, but they set up high-level meetings on what could be a path towards a comprehensive deal.We also continued to hear reports that the US and Canada were in trade talks, something we've been writing about all week. That was confirmed by the US ambassador, though whether there is a deal before the G7 on June 15 is now the question.The big drama came late in the day as the relationship between Elon Musk and Trump utterly imploded. It started as a fight over deficits but got very ugly, very quickly as Elon said Trump was in the Epstein files and should be impeached. Trump said he was taking away Elon's subsidies and shares of Tesla closed down 14.3%.The ECB decision was moderately hawkish as officials teed up a pause in July after 8 straight quarter-point cuts. The market is now priced for just 25 bps more in easing in this cycle. The euro initially rose to 1.1494 but couldn't climb above the big figure and later gave back 50 pips. Part of that was USD volatility and some 'sell the fact' on the US-China talks.All told, the moves were relatively small on most fronts and the biggest mover was the yen, which roundly declined on falling trade tensions. Eyes now though might move to the US budget bill as Elon fights it. Republicans are hoping to pass it by July 4. This article was written by Adam Button at www.forexlive.com.

U.S. Treasury says semi-annual currency report found no major U.S. trading partners manipulated currency to gain unfair trade advantage in four quarters through December 2024No major trading partners met all three criteria for enhanced analysis during review periodMonitoring list of trading partners whose currency practices ‘merit close attention’ includes China, Japan, South Korea, Singapore, Taiwan, Vietnam, Germany, Ireland and SwitzerlandIreland, Switzerland added to monitoring list due to large bilateral trade surplus with U.S. and large global current account surplusWhile China is not labeled a currency manipulator amid yuan depreciation pressure, China stands out among trading partners for lack of transparency on exchange rate practices and policiesLack of transparency will not preclude Treasury from designating China if evidence suggests it is intervening through formal or informal channels to resist yuan appreciation in the futureThe U.S. Treasury’s semi-annual currency report is an official document submitted to Congress that assesses the foreign exchange policies of major U.S. trading partners. Its primary focus is to determine whether any country is deliberately manipulating its currency to gain an unfair trade advantage—typically by undervaluing their currency to boost exports to the U.S. The report is mandated by the Omnibus Trade and Competitiveness Act of 1988 and the Trade Facilitation and Trade Enforcement Act of 2015, which require Treasury to monitor and analyze currency practices globally.Each report typically reviews economies with significant bilateral trade surpluses with the U.S., material current account surpluses, and persistent one-sided currency intervention. Based on these criteria, Treasury may label a country as meeting enhanced analysis thresholds and place it on a "Monitoring List." In more serious cases, a country may be formally designated a currency manipulator, though this is rare and politically sensitive. The designation can trigger bilateral negotiations and, potentially, sanctions if corrective action isn't taken.While the label "currency manipulator" gets the most attention, the report is also a key tool in the Treasury’s broader oversight of global macroeconomic imbalances. It provides detailed commentary on global FX trends, capital flows, and policy frameworks, and it often signals Washington's diplomatic posture towards countries like China, Japan, Germany, and others with large external surpluses or tightly managed exchange rates. This article was written by Eamonn Sheridan at www.forexlive.com.

more to comeThis snapshot from the ForexLive economic data calendar, access it here.The times in the left-most column are GMT.The numbers in the right-most column are the 'prior' (previous month/quarter as the case may be) result. The number in the column next to that, where there is a number, is the consensus median expected. This article was written by Eamonn Sheridan at www.forexlive.com.

Good morning, afternoon and evening all. Any charts, technical analysis, trade ideas, thoughts, views, ForexLive traders would like to share and discuss with fellow ForexLive traders, please do so: This article was written by Eamonn Sheridan at www.forexlive.com.