Global Markets:
- Asian stock markets: Nikkei down 0.45 %, Shanghai Composite gained 0.80 %, Hang Seng rose 0.40 %, ASX 200 fell 0.10 %
- Gold at $1228, Silver at $16.15, WTI Oil at $47.00, Brent Oil at $49.50
- US 10 year yield at 2.32, UK 10 year yield at 1.25, German 10 year yield at 0.48
News & Data:
- Chinese Caixin Services PMI Jun: 51.6 (prev 52.8)
- Chinese Caixin Composite PMI Jun: 51.1 (prev 51.6)
- New Zealand ANZ Commodity Price Jun: 2.1% (prev 3.20%)
- Australian AiG Perf of Services Index Jun: 54.8 (prev 51.5)
- UK BRC Shop Price Index (Y/Y) Jun: -0.3% (prev -0.4%)
- PBoC Fixes USDCNY Reference Rate At 6.7922 (prev fix 6.7981 prev close 6.8005)
Markets Update:
The Dollar remained bid overnight. However, this seems more like a small recovery before the downtrend continues rather than the beginning of a reversal. The Fed’s rate path is now quite clear, and unless economic data surprises, there will not be a rate hike until December. Meanwhile, rate expectations in other countries are rising – which is making the Dollar less attractive.
The Euro is likely to find good support ahead of 1.1320. Buying interest remains high and the charts suggest further gains are ahead. In the near-term, the pair could soon test 1.15, especially if US jobs data on Friday disappoints.
GBPUSD came slightly under pressure, but managed to stay above 1.29. Key support is seen at 1.2850. Meanwhile, the Australian Dollar is struggling following yesterday’s RBA meeting. Short-term technicals remain slightly positive as long as AUDUSD is above 0.75. A break below 0.75 support could signal a pullback to at least 0.72.
Economic Calendar:
- 08:45 BST – Italian Services PMI
- 08:50 BST – French Services PMI
- 08:55 BST – German Services PMI
- 09:00 BST – Euro Zone Services PMI
- 10:00 BST – Euro Zone Retail Sales
- 19:00 BST – FOMC Meeting Minutes
