• Monday: Japan
    Wage data.
  • Tuesday: US
    NFIB Small Business Optimism Index, Fed Chair Powell Testimony.
  • Wednesday: Japan
    PPI, China CPI, RBNZ Policy Decision, Fed Chair Powell Testimony.
  • Thursday: UK
    GDP, US CPI, US Jobless Claims.
  • Friday: New
    Zealand Manufacturing PMI, US PPI, US University of Michigan Consumer


Fed Chair Powell will testify to the
Senate Banking Committee on Tuesday and the House Financial Services Committee
on Wednesday. The market participants will be attentive to any view or hint
about the monetary policy trajectory after the recent NFP

The text is generally released before
the testimony so that will be scanned for clues or “bias”,
but the market will also be focused on the Q&A session following the
opening remarks. Given the recent data, Powell will likely lean on the dovish

Fed Chair Powell


The RBNZ is expected to keep interest
rates unchanged at 5.5%. As a reminder, the central bank delivered a hawkish
hold at the last
as they raised the Official Cash
Rate forecasts and pushed back the first rate cut to late 2025. The market
continues to expect 41 bps of easing by the end of the year.



The US CPI Y/Y is expected at 3.1% vs.
3.3% prior, while the M/M measure is seen at 0.1% vs. 0.0% prior. The Core CPI
Y/Y is expected at 3.4% vs. 3.4% prior, while the M/M figure is seen at 0.2%
vs. 0.2% prior.

This is going to be an important release.
I think the Fed will be more dovish at the next meeting if we get a good
report. Then, if we get some more benign figures in August, Fed Chair Powell
will likely pre-commit to a rate cut in September at the Jackson Hole


The US Jobless Claims continue to be one
of the most important releases to follow every week as it’s a timelier
indicator on the state of the labour market.

Initial Claims remain pretty much stable
around cycle lows and inside the 200K-260K range created since 2022. Continuing
Claims, on the other hand, have been on a sustained rise recently with the data
printing new cycle highs every week.

This shows that layoffs are not
accelerating and remain at low levels while hiring is more subdued. This is
something to keep an eye on. This week Initial
Claims are expected at 240K vs. 238K prior,
while Continuing Claims are seen at 1860K vs. 1858K prior.

US Jobless Claims


The US PPI Y/Y is expected at 2.3% vs.
2.2% prior, while the M/M measure is seen at 0.1% vs. -0.2% prior. The Core PPI
Y/Y is expected at 2.5% vs. 2.3% prior, while the M/M figures is seen at 0.2%
vs. 0.0% prior. I don’t expect this data to influence the market much given
that the sentiment will be set by the CPI report the day before.


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