EURUSD
- EUR/USD fell by 0.24% to 1.0884 ahead of the release of manufacturing PMI data for most of Europe. This suggests a decline in the exchange rate as investors anticipate weak performance in the manufacturing sector.
- European Central Bank policymaker Joachim Nagel is scheduled to speak at a financial conference and is expected to advocate for more interest rate hikes to address inflation, even amid slowing economic growth in the region. This reinforces the hawkish sentiment surrounding the euro.
- The U.S. dollar slightly strengthened in early European trade, recovering from Friday's losses following softer-than-expected inflation data. The start of a holiday-shortened week may contribute to cautious trading.
- The Federal Reserve is set to release the minutes of its June 13-14 meeting, during which interest rates were kept unchanged after a series of 10 consecutive rate hikes. The minutes may provide insights into the central bank's outlook on monetary policy.
| SMA (20) | Slightly Rising |
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| RSI (14) | Slightly Falling |  | ||
| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: EUR/USD declined prior to the release of manufacturing PMI data, indicating concerns about the sector's performance. European Central Bank policymaker Joachim Nagel's expected support for more interest rate hikes reinforces the euro's strength. The U.S. dollar recovered slightly and awaits the release of the Federal Reserve's meeting minutes. Overall, the market sentiment suggests caution and a focus on central bank actions and economic data.
GBPUSD
- GBP/USD fell by 0.16% to 1.2673, following a 5% rise in the first half of the year. Traders are factoring in expectations of additional rate hikes from the Bank of England due to the country's high inflation rate of 8.7% in May, which is the highest among major advanced economies.
- GBP/USD dropped below 1.2600 for the first time since June 13, driven by the overall strength of the US dollar. The broad-based strength of the dollar has exerted downward pressure on the British pound.
- The Dollar Index, which monitors the performance of the dollar against six other currencies, experienced a 0.26% increase, reaching 103.19. This follows a 0.4% decline observed on Friday.
- The dollar was negatively affected on Friday by lower-than-expected inflation in May, suggesting that the Federal Reserve's year-long tightening cycle is starting to impact the economy.
| SMA (20) | Slightly Rising |
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| RSI (14) | Slightly Falling | |
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| MACD (12, 26, 9) | Slightly Falling | |
Closing statement: GBP/USD experienced a decline as the British pound faced pressure from the strong US dollar. The pound's previous upward momentum was driven by expectations of further rate hikes from the Bank of England due to high inflation in the UK. The US dollar rebounded from Friday's dip following softer inflation data, highlighting the impact of the Federal Reserve's tightening measures.
GOLD
- Gold prices remained relatively unchanged in early trading as market participants awaited further information on the U.S. economy. In contrast, copper prices rose due to positive data indicating strength in the Chinese manufacturing sector.
- Gold received some support from a decline in the personal consumption expenditures price index, which is the Federal Reserve's preferred inflation gauge. This decline weighed on the dollar and led to a rally across various asset classes, including gold.
- Traders have been cautious about pushing the dollar lower, with limited activity ahead of the Independence Day holiday and important economic data scheduled for release. These data points may provide additional insights into whether the U.S. central bank will resume its rate-hiking cycle after pausing in June.
- The U.S. employment report on Friday is expected to be the main event of the week, with economists anticipating the addition of 225,000 jobs in June. Although this represents a slowdown from May's figure of 339,000, it is still considered a healthy outcome.
Closing statement: Gold experienced limited movement as gold prices remained stable while awaiting further cues on the U.S. economy. Positive data from the Chinese manufacturing sector contributed to the rise in copper prices. Gold found support from a decline in the personal consumption expenditures price index, which weakened the dollar and led to a broader asset rally. Traders displayed caution due to the upcoming holiday and the anticipation of important economic data, including the U.S. employment report, which is expected to show a healthy job addition in June.
CRUDE OIL
- Crude oil prices declined on Monday due to concerns over a global economic slowdown and the potential for additional interest rate hikes by the U.S. Federal Reserve. These factors offset expectations of tighter supplies resulting from OPEC+ production cuts.
- Factory activity growth in China, the largest crude oil importer, slowed in June, reflecting subdued market conditions and a decline in sentiment and recruitment, as indicated by the Caixin/S&P Global private sector survey.
- Some analysts anticipate a tightening of oil supplies in the second half of the year, leading to higher prices. Saudi Arabia, the top oil exporter, has pledged an additional 1 million barrels per day output cut in July, while the United States is gradually replenishing its Strategic Petroleum Reserve.
- The possibility of higher interest rates by the Federal Reserve could strengthen the U.S. dollar. This would make commodities, including oil, more expensive for holders of other currencies and potentially dampen oil demand.
| SMA (20) | Slightly Falling | |
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| RSI (14) | Slightly Rising |
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| MACD (12, 26, 9) | Slightly Rising |
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Closing statement: Crude oil prices declined due to concerns about a global economic slowdown and the potential for further interest rate hikes by the U.S. Federal Reserve. Slower factory activity growth in China also contributed to the downward pressure on prices. Despite expectations of tighter supplies resulting from production cuts, the market remains cautious. The announcement of an additional output cut by Saudi Arabia and the gradual replenishment of the U.S. Strategic Petroleum Reserve may support a tightening of supplies in the second half of the year. However, the impact of higher interest rates on the U.S. dollar and oil demand remains a factor to monitor.
DAX
- European stock markets showed slight gains on Monday, following the positive sentiment from the previous week. Investors were analysing mixed regional manufacturing data, which impacted market dynamics.
- The DAX index in Germany traded flat, the CAC 40 in France rose by 0.18%, and the FTSE 100 in the U.K. remained mostly unchanged.
- The manufacturing sector in Europe, particularly in Germany, the dominant manufacturing base of the eurozone, is expected to remain in contraction. Germany's manufacturing sector contracted at the fastest pace in over three years in June, with a reading of 40.6 in a survey, indicating both output and new orders declining.
- The report highlighted that German manufacturing firms experienced deeper cuts in production levels in response to sustained weak demand towards the end of the second quarter.
| SMA (20) | Slightly Rising |
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| RSI (14) | Neutral | |
| MACD (12, 26, 9) | Neutral |
Closing statement: The DAX40 index traded flat in Germany, while European stock markets overall displayed modest gains, building on the positive sentiment from the previous week. However, the manufacturing sector in Europe, especially in Germany, continued to face contractionary conditions, with notable declines in output and new orders. The sustained weakness in demand prompted German manufacturing firms to implement further production cuts.