Market Roundup
• EU May Loans to Non Financial Corporations 0.3% forecast, 0.3% previous
• EU May M3 Money Supply (YoY) 1.6%,1.5% forecast, 1.3% previous
•Italian Jun Business Confidence 86.8, 88.7 forecast, 88.4 previous
•Italian Jun Consumer Confidence 98.3 ,97.0 forecast, 96.4 previous
• EU Jun Selling Price Expectations 6.1,6.4 previous
• EU Jun Business and Consumer Survey 95.9,96.2 forecast,96.0 previous
• EU Jun Industrial Sentiment -10.1,-9.6 forecast, -9.9 previous
• EU Jun Services Sentiment 6.5,6.4 forecast, 6.5 previous
• EU Jun Consumer Confidence -14.0,-14.0 forecast,-14.0 previous
•US Real Consumer Spending (Q1) 1.5%, 2.0% forecast, 3.3% previous
•US GDP Sales (Q1) 1.8%, 1.7% forecast, 3.9% previous
•US PCE Prices (Q1) 3.4%, 3.3% forecast, 1.8% previous
•US Core PCE Prices (Q1)3.70%, 3.60% forecast,2.00% previous
•US GDP (QoQ) (Q1)1.4%,1.3% forecast, 3.4% previous
•US GDP Price Index (QoQ) (Q1) 3.1%,3.1% forecast, 1.7% previous
•US May Durable Goods Orders (MoM) 0.1%,-0.5% forecast, 0.7% previous
•US May Goods Orders Non Defense Ex Air (MoM) -0.6%, 0.3% previous
•US May Core Durable Goods Orders (MoM) -0.1%,0.2% forecast,0.4% previous
•US May Retail Inventories Ex Auto 0.0%,0.3% previous
•US May Durables Excluding Defense (MoM) -0.2% forecast,-0.5% previous
•US May Goods Trade Balance -100.62B,-96.00B forecast,-99.41B previous
•US Initial Jobless Claims233K, 236K forecast,238K previous
•US Jobless Claims 4-Week Avg. 236.00K,232.75K previous
•US Durables Excluding Transport (MoM)-0.1% forecast,0.4% previous
•US Continuing Jobless Claims1,839K,1,820K forecast,1,828K previous
•US Pending May Home Sales (MoM) -2.1%,0.6% forecast,-7.7% previous
Looking Ahead Economic Data (GMT)
•20:30 USFed's Balance Sheet 7,253B previous
Looking Ahead Events And Other Releases (GMT)
•No Events Ahead
Currency Forecast
EUR/USD: The euro slipped lower against dollar on Thursday as euro was weighed down by political turmoil in the euro zone in the lead up to France's snap election set to begin this weekend. French far-right leader Marine Le Pen is confident her party will win an absolute majority in parliament, form a government and impose limits on what President Emmanuel Macron can do to support Ukraine, she said days before voting starts.Macron will remain president after a snap legislative election on June 30 and July 7, which he called after Le Pen's National Rally (RN) trounced his centrist Together alliance in European elections, but may have to share power with his foes. Opinion polls consistently suggest the anti-immigrant, eurosceptic RN has a comfortable lead in terms of share of the popular vote, with a left-wing coalition in second place and Macron's centrists in third.Immediate resistance can be seen at 1.0727(Daily high), an upside break can trigger rise towards 1.0746(38.2% fib).On the downside, immediate support is seen at 1.0680(23.6% fib), a break below could take the pair towards 1.0634(Lower BB).
GBP/USD: The pound edged up on Thursday, heading for its first weekly gain in a month, as the dollar eased ahead of U.S. inflation data that could prompt the Federal Reserve to cut interest rates more than markets currently anticipate. Friday's report on the core U.S. personal consumptions expenditure index (PCE), which excludes food and energy prices, is expected to show it has moderated to a rate of 2.6% in May, from 2.8% in April.This is the Fed's preferred measure of consumer inflation and could influence traders' thinking on where U.S. rates could go this year.Futures markets show investors are sure the Fed will cut rates at least once this year, with roughly a 50/50 chance of a second cut, largely in line with expectations for the Bank of England. ,More immediately, however, the focus for markets and for sterling in particular, are the upcoming elections in France and Britain. Immediate resistance can be seen at 1.2685(38.2%fib), an upside break can trigger rise towards 1.2775(23.6%fib).On the downside, immediate support is seen at 1.2637(50%fib), a break below could take the pair towards 1.2586(61.8% fib).
USD/CHF: The dollar strengthened against the Swiss franc on Thursday as traders braced for US inflation report. Traders are waiting for Friday's U.S. personal consumption expenditures (PCE) data, which is the U.S. Federal Reserve's preferred inflation measure and could help traders determine the outlook for the Fed's interest rate. The Fed has been projecting only one interest rate cut this year, in December. But investors see a 56.3% chance of a 25-basis point rate cut in September, and about two cuts by the year-end . The dollar index dipped 0.15% to 105.89, not far from a nearly two-month high of 106.13 on Wednesday.Immediate resistance can be seen at 0.8980 (23.6% fib), an upside break can trigger rise towards 0.9018 (Higher BB).On the downside, immediate support is seen at 0.8936 (38.2% fib), a break below could take the pair towards 0.8891 (50% fib).
USD/JPY: The dollar held near 38 year high against yen on Thursday as traders were on alert for any signs of intervention from Japanese authorities to prop up the currency. The Japanese currency has fallen some 2% this month and 12% for the year against a resilient dollar, as it continues to be hammered by stark interest rate differentials between the U.S. and Japan, which has maintained the appeal of using the yen as a funding currency for carry trades.In a carry trade, an investor borrows in a currency with low interest rates and invests the proceeds in higher-yielding assets. The yen weakened another 0.2% to 160.47 per dollar , having fallen to a low of 160.88 on Wednesday, its weakest since 1986. Strong resistance can be seen at 160.83(23.6%fib), an upside break can trigger rise towards 161.00(Psychological level).On the downside, immediate support is seen at 159.41 (38.2% fib), a break below could take the pair towards 158.02(50%fib).
Equities Recap
European shares were flat on Thursday as investors avoided large bets ahead of crucial global economic data and the first round of French elections, while H&M sank after missing quarterly profit forecasts.
UK's benchmark FTSE 100 was last down by 0.38 percent, Germany's Dax was last up by 0.16 percent, France’s CAC was last down by 0.81 percent.
Commodities Recap
Gold prices rose 1% on Thursday from an over two-week low hit in the previous session as the dollar softened, with the market spotlight on key U.S. inflation data for more cues on the Federal Reserve's interest rate path.
Spot gold was up 1.3% at $2,327.11 per ounce, as of 1412 GMT, after falling on Wednesday to its lowest level since June 10.U.S. gold futures were 1.1% higher at $2,337.90.
Oil prices edged higher on Thursday as supply disruption risks from rising geopolitical tensions in the Middle East helped to counter demand fears after a surprise build in U.S. stockpiles.
Brent crude oil futures gained 70 cents, or 0.82%, to $85.95 a barrel by 1202 GMT. U.S. West Texas Intermediate crude futures rose 57 cents, or 0.7%, to $81.47.
