TACO Delivered a Day after Cinco De Mayo

There is one overarching fundamental development today that is driving the risk-on in the capital markets and weighing on the dollar. President Trump announced the US was suspending its new escort service in the Strait of Hormuz. Ostensibly at the request of Pakistan and other countries, the decision was to give negotiators more time. Front-month oil futures contracts are off 8-10% today. It has arrested the rise in bond yields and is lifting equities. The dollar is lower against the G10 currencies, but the Norwegian krone, which is particularly sensitive to large moves in crude oil prices. The yen jump dramatically ...