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Market Recap
The volatile conditions continued to round out last week with Wall Street rebounding, seeing the Dow Jones close +1.6%, the S&P 500 +1.1%, and the Nasdaq +1%. U.S. 10-year yields fell by 5 bps to 4.19%, while crude oil closed -1.9% at $76.80 a barrel. The AUD/USD traded in a 0.6536/0.685 range before closing the week at 0.6547.
A quiet session into the London lunch saw the greenback a touch weaker. The antipodes reached 0.6566 (AUD/USD) and 0.5903 (NZD/USD), while EUR/USD and GBP/USD traded as high as 1.0861 and 1.2874, respectively. USD/JPY was also bid 70 points higher on the session to 154.74.
The U.S. June PCE price index saw a small beat in YoY terms, both in core and headline measures printing 2.5% and 2.6%, respectively, while meeting MoM forecasts. Personal spending was consistent with 0.3% expectations, while personal income fell short of 0.4% expectations, reading 0.2%.
The greenback was modestly weaker in response to the data, with the local unit making its way to highs of 0.65685. NZD/USD moved up above 0.5900 to hit 0.5905, while EUR/USD made 1.0868 highs. USD/JPY, meanwhile, fell to lows of 153.10 over the NY morning.
The University of Michigan Sentiment Survey for July was revised up to 66.4 from 66.0, though this was a little short of 66.5 expectations. Little reaction to the data, though there was still some movement in currency markets, with GBP/USD falling to lows of 1.2850, extending the daily range to almost 25 points. USD/CAD also moved up to 1.3849 highs as crude oil fell to 2.5% losses on the day.
Day Ahead
A busy week for central banks is ahead with the BOJ and FOMC decisions due on Wednesday and the BOE decision on Thursday.
Australia’s Q2 CPI will also be released Wednesday and will be closely watched by the market ahead of the RBA’s August 6th meeting.
AUD/USD traded in a 0.6536/68 range on Friday with all key levels remaining intact. Demand rests at 0.6460/80, while offering interest remains above 0.6700.
Economic Data to Watch
- New Zealand: June Filled Jobs SA (m/m)
- Japan: BOJ Outright Bond Purchases
- United Kingdom: June Mortgage Approvals, July CBI Retailing Reported Sales
- United States: July Dallas Fed Manufacturing Activity
Disclaimer
The information provided in this daily market update is for informational purposes only and should not be considered as financial advice. Trading Forex and CFDs involves significant risk of loss and may not be suitable for all investors. Past performance is not indicative of future results. CA Markets does not guarantee the accuracy or completeness of the information provided, and we recommend consulting with a qualified financial advisor before making any trading decisions. Users are solely responsible for their own trading activities and decisions.
