Dollar could strengthen  Oil slips
Yen ascends  Gold’s quiet rise

The US dollar started off 2016 on a strong foot, but has been falling for three months. May has historically been a good month for the greenback, as shown by the chart below. Analysts think that this year may follow the pattern. If data improves, there is expectation that the Federal Reserve could raise rates in June.


Chart from Bloomberg

Many of the world’s markets, including those of the UK, Hong Kong and China, are closed today, but one currency is far from quiet. The Japanese yen, trading at 106.38 to the US dollar at the time of writing, is continuing to gather momentum, putting pressure on Japanese stocks. The yen is at its strongest level in 18 months. In response, the US has recently put the yen on a currency watch list to evaluate for potential unfair trade advantage.

There have recently been signs of optimism for oil, but prices fell for the second day as a result of Iraqi exports approaching a near-record high, triggering concerns about overproduction. The second and third largest oil-service companies have called off a $28 billion merger as a result of industry conditions. While the world frets about oil, another commodity is continuing its ascent. Gold futures climbed above $1300 for the first time since January of last year, representing a 23% gain this year.

EURUSD: Euro rising on continuing dollar weakness.

GBPUSD: Pound stronger on quiet markets.

AUDUSD: Aussie dollar up despite struggling oil.

USDCAD: Canadian dollar weaker on oil slide.