The U.S. Dollar is trading in stronger ranges to begin the week after a long holiday that saw markets worry over the promises of higher tariffs.
Overview
Indeed, futures in the S&P 500 Index are down while the Buck sees a bit of a break from the deep declines it has experienced lately. Today is being characterized by headlines regarding tariffs, how some may unilaterally be imposed in the next couple of days and how there is possibility that another extension may be in the works for many countries. The lack of detail is still making nervous investors wonder what may come next.
The Buck seems to be performing particularly well against Asian tender as well as Antipodean currencies in Australian (AUD) and New Zealand Dollar (NZD) with growing concern that the gloomy horizon requires looser monetary policy. The Reserve Bank of Australia is expected to make a 25-basis-point cut tomorrow. As far as domestic economic releases, this week is limited in terms of significant data points with the Fed Minutes from the last meeting out Wednesday while we look at the first week of July’s Jobless Claims. Expect movement to emanate primarily from ever-changing developments about timelines for tariff implementation.
What to Watch This Week…
- Fed Minutes on Wednesday 2PM
- Jobless Claims on Thursday 8:30AM
- Monex USA Online is always open
The complete Economic Calendar can be found here.
EUR ⇓
The Euro stopped its advancement as global markets stand attentive to possible announcements of relief regarding tariffs. There is worry that more uncertainty and volatility are ahead. More importantly, European numbers revealed some contractions when it comes to consumption, with May’s figures for Retail Sales worse than expected. An advance in April was erased entirely and more after a (-0.7%) decline. We shall wait and see if any progress is made for a turnaround in fortunes for the shared currency.
JPY ⇓
The Japanese Yen is dropping in value as concerns mount over the future of spending and the possibility of higher inflation than desired. Japan narrowly avoided a final figure showing contraction for Gross Domestic Product in Q1 after coming in flat (0.0%), so it must worry about heading into a prolonged period of “Stagflation.” The country’s 30-year yield climbed with traders thinking that Upper House elections scheduled for July 20th will likely result in more willingness to increase spending. Current sentiment is not favoring any safe-haven asset except for the U.S. Dollar.
