On this Monday, July 3rd, please take note of the following:
Despite a lackluster showing on Friday, the US Dollar (USD) is holding steady against its major rivals as Monday trading begins. Small daily gains for the US Dollar Index above 103.00 are being held onto ahead of the June ISM Manufacturing PMI report. The HCOB Manufacturing PMIs are scheduled for adjustment on the European economic calendar. The market will also be listening for any remarks made by central bank officials. Remember that on Monday, July 4th, the US stock and bond markets will close early and remain closed all day in commemoration of the Independence Day holiday.
The US Bureau of Economic Analysis stated last Friday that annual inflation in the country, as measured by the change in the Personal Consumption Expenditures (PCE) Price Index, decreased to 3.8% in May from 4.3% in April. During the same time period, the Core PCE Price Index decreased marginally, from 4.7% to 4.6%. The US dollar weakened somewhat heading into the weekend after investors’ first reaction to weak inflation readings.
China’s Caixin Manufacturing PMI for June came in at 50.5 during Monday’s Asian trading day, down from 50.9 in May but higher than the consensus prediction of 50.2. The Hang Seng Index in Hong Kong is up 2% so far today, and the Shanghai Composite Index is still on course for a daily rise of over 1%. US stock index futures, despite this, are trading flat during the European morning.
The euro/dollar pair was essentially unchanged for the week after a recovery on Friday. Modest bearish pressure persists early Monday, keeping the pair below 1.0900.
Last week, the British pound gained ground against the US dollar, closing the week at a level not far from 1.2700. Monday’s small fluctuations below that level reflect the USD’s continued strength.
The USD/JPY corrected lower on Friday but recovered early in the following week. The pair was trading up near 144.80 at the time of writing. According to the Bank of Japan’s (BoJ) quarterly Tankan survey, “Japanese companies expect consumer price rises of 2.6% on average a year from now, down from their 2.8% projections three months ago.” The headline Tankan Large Manufacturing Index rose to 5.0 in Q2 from 1.0 in Q1, which was better than the 3.0 predicted by economists.
A fresh plan to enhance economic ties with China was announced early Monday by Australian economic Minister Don Farrell. The Australian dollar weakened against the US dollar during the European morning after rising somewhat during the Asian session. The last time the AUD/USD price went below 0.6650, it had dropped by more than 0.3% on the day. The Reserve Bank of Australia will reveal its interest rate decision this coming Tuesday.
On Friday, gold ended a four-day losing skid and recovered most of its weekly losses. On Monday morning, the XAU/USD pair is unchanged over $1,910.
Bitcoin was unable to gain momentum over the weekend, and its sideways slog above $30,500 continued into Monday morning. Ethereum’s price surged to a high of almost $1,950, its highest point since May.
