Bond Markets Make the Headlines (05.20.2026)

Japan’s 10-year yield held near its highest level since 1996 at 2.79% after stronger GDP growth and rising energy costs reinforced expectations of a near-term BOJ rate hike.

US Treasury yields stayed close to a 16-month high near 4.67%, while the dollar index remained around a six-week peak as oil-driven inflation concerns continued supporting expectations of restrictive Fed policy.

Meanwhile, US stock futures were little changed before Nvidia earnings and results from several major companies, following a third consecutive decline on Wall Street driven by rising yields and inflation concerns.

Euro Searches for Fresh Momentum

EUR/USD hovered near the 1.1600 mark as opposing central-bank narratives kept the pair locked in a narrow range. Firm US economic figures and steady Treasury yields limited the dollar, while expectations for additional ECB tightening helped prevent a deeper euro decline.

With growth slowing across the Eurozone and PMI data approaching, the next directional clue may come from whether economic weakness or inflation concerns take the upper hand.

For EUR/USD, the initial resistance is seen at 1.1660, while the closest support is positioned at 1.1550.

Gold Faces a Tougher Environment

Gold slipped below $4,470 per ounce, extending its retreat as oil-driven inflation concerns revived expectations of restrictive monetary policy. Warnings from Donald Trump regarding possible military action against Iran kept attention on the Strait of Hormuz, where supply disruptions supported energy prices.

The combination of stronger inflation readings and firm yields left bullion struggling to regain momentum despite lingering uncertainty across the region.

First resistance is seen at $4520, with initial support near $4400.

Strong Growth Fails to Lift the Yen

The yen remained pinned near 159 per dollar, keeping the spotlight firmly on the 160 level that previously triggered official intervention.

Strong Japanese GDP data strengthened the case for another Bank of Japan rate increase, yet dollar demand and higher energy costs limited any meaningful recovery. The closer the pair moves toward 160, the louder the discussion around potential action from Tokyo becomes.

Initial resistance stands at 160.00, while the first support is located at 158.20.

Weak Jobs Data Clouds the UK Outlook

Sterling slipped toward the 1.34 area after a disappointing UK labour market report pointed to a softer economic backdrop.

Payrolls fell sharply, unemployment reached 5%, and wage growth slowed, reducing expectations for further Bank of England tightening. Rising oil prices and domestic political uncertainty added another layer of pressure for the pound.

From a technical view, resistance stands near 1.3430, with support around 1.3340.

The Shine Fades From Silver’s Rally

Silver traded below $74 per ounce after another sharp decline, reversing much of the enthusiasm linked to industrial and AI-related demand themes.

Inflation concerns tied to higher oil prices, combined with firm rate expectations, weighed on precious metals. Developments surrounding Iran and the Strait of Hormuz remained closely tied to sentiment, keeping volatility high across the sector.

From a technical view, resistance stands near $75.70 while support is located around $72.50.