ECB Minutes, Powell and Stats to Provide Direction on the Day

While Powell follows Trump’s lead and takes a more dovish stance, U.S inflation figures could shift sentiment once more,… ECB minutes are also due out.
Bob Mason
Forex Yearly

Earlier in the Day:

It was another relatively busy Asian session this morning. Key stats including New Zealand electronic card retail sales figures and Australia’s home loan numbers. Later this morning tertiary industry activity figures are also due out of Japan.

Outside of the stats, the markets reacted further to FED Chair Powell’s testimony to Congress on Wednesday.

For the Kiwi Dollar

Month-on-month, electronic card retail sales stagnated in June, which was worse than a forecasted 0.7% rise. In May, sales had fallen by 0.5%. According to NZStats,

  • The largest move came from the fuel industry, with spending falling by 4.3% from May 2019, the fall coming off the back of lower fuel prices.
  • Durables saw the largest increase in spending, up by 1.7%, with sales of apparel surging by 2.1%.
  • Spending on hospitality and consumables, along with the slide in spending on fuel, pinned back total sales, however.

The Kiwi Dollar moved from $0.66518 to $0.66507 upon release of the figures. At the time of writing, the Kiwi Dollar was up by 0.05% to $0.6650

For the Aussie Dollar

The number of new home loan commitments were flat in May, coming in ahead of a forecasted 0.6% fall. Home loans had fallen 1.2% in April, according to the ABS.

The Aussie Dollar moved from $0.69581 to $0.69566 upon release of the figures. At the time of writing, the Aussie Dollar was down by 0.04% to $0.6956.

Elsewhere

The Japanese Yen was up by 0.33% to ¥108.1 against the U.S Dollar.

The Day Ahead:

For the EUR

It’s a busy day ahead on the economic calendar. Finalized German and French inflation figures for June will be in focus. Barring any revisions, however, we would expect the EUR to have a muted reaction to the numbers.

The focus on the day will be on the ECB’s monetary policy meeting minutes due out in the early afternoon.

While Draghi held back from talking up further easing at the last press conference, there may have been some chatter of the need to ease further in the meeting…

FED Chair Powell’s testimony to Congress later today could have a further impact on the global financial markets…

At the time of writing, the EUR was up by 0.10% to $1.1262.

For the Pound

It’s a quiet day ahead. While there are no material stats due out of the UK, the BoE’s financial stability report will provide direction.

Following Wednesday’s stats and BoE Governor Carney’s recent comments on downside risks, today’s report will be of interest.

On the political front, expect chatter over the leadership race and Brexit to also provide direction on the day.

At the time of writing, the Pound was up by 0.06% to $1.2509.

Across the Pond

It’s another busy day for the Greenback. Key stats include June inflation figures and the weekly jobless claims numbers.

Any unexpected weakness in the inflation numbers could support the speculation of a near-term rate cut. The numbers are due out ahead of FED Chair Powell’s 2nd day of testimony to Congress and could feature…

There will also be updates on the U.S – China trade talks to consider on the day.

At the time of writing, the Dollar Spot Index was down by 0.10% to 97.011.

For the Loonie

Economic data due out of Canada is limited to new house price figures that are unlikely to have an impact.

On the oil front, OPEC’s monthly report will provide the Loonie with direction.

The Loonie was up 0.15% at C$1.3063, against the U.S Dollar, at the time of writing.

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