Erik Schafhauser Zürich Erik Schafhauser Zürich Erik Schafhauser Zürich

Morning Brew May 30 2023

Morning Brew 1 minute to read
Erik Schafhauser

Senior Relationship Manager

Summary:  Yields and debt-ceiling struggle boosts USD

Trading is a bit choppy into the last week of May.

While there was a general agreement on the debt ceiling, several prominent republicans including Ron DeSantis stated they would appose the deal. This causes equities to pause.

The yield curve is starting to look a bit crazy with the 1 month at 5.8% and the 10 Year a full 2% lower – the expectation for the June meeting has turned in favor of a 25 BPS Hike with a probability of 60%.

The combination of risk averseness and higher yields boost the USD to the highest since early March, the USD Index is at 104.50, EURUSD 1.0685, GBPUSD 1.2330 and USDJPY at 140.80. The Turkish Lira fell after Edogans election and is trading at more than 20 Lira per USD.

Gold and Silver are at 1933 and 23.00.

Indexes are so far unimpressed by the risk aversion affecting FX and the S&P is above the important 4.200 at 4.217 in the CFD, the US 30 33.140, the US Tech 100 11.419. The GER40 is just below the 16k.

The week will be driven by progress or lack thereof around the debt ceiling in the US and the near term rate outlook. Key planned event is likely to be the US Non-Farm Payroll on Friday but News on the Debt ceiling could cause jumps at any time. 

Key events this week:


U.S.                 Conference Board consumer confidence (May)

Eurozone         M3 growth (Apr)

Eurozone         Consumer confidence & economic confidence (May)

Earnings: HP, HP Enterprise, JOYY

Wednesday 31 May

U.S.                 Chicago PMI (May)

U.S.                 JOLTS job openings (Apr)

U.S.                 Fed Beige book

Germany         CPI EU harmonized (May)

Japan              Industrial production (Apr)

Japan              Retail sales (Apr)

Japan              Housing starts (Apr)

China               NBS manufacturing PMI & non-manufacturing PMI (May)

Australia          CPI (Apr)

India                Real GDP (Q1)

South Korea    Industrial Production (Apr)

Earnings: Salesforce, Crowdstrike, Okta

Thursday 1 June

U.S.                 ADP private employment (May)

U.S.                 Initial jobless claims (weekly)

U.S.                 ISM manufacturing index (May)

Eurozone         CPI EU harmonized (May)

Japan              Investment in plant and equipment (Q1)

China               Caixin manufacturing PMI (May)

Earnings: Broadcom, VMware, Lululemon Athletica, Dell Technologies, MongoDB, Zscaler, Dollar General, Hormel Foods, Bilibili


Quarterly Outlook 2024 Q2

2024: The wasted year

01 / 05

  • Macro: It’s all about elections and keeping status quo

    Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.

    Read article
  • FX: The rate cut race shifts into high gear

    As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.

    Read article
  • Equities: The AI and obesity rally is defying gravity

    Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.

    Read article
  • Fixed income: Keep calm, seize the moment

    With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.

    Read article
  • Commodities: Is the correction over?

    Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.

    Read article


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (
Full disclaimer (

Saxo Bank (Schweiz) AG
The Circle 38

Contact Saxo

Select region


All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) Ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law. 

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.