Investinglive European FX news wrap: US dollar remains supported, stock markets back up

• Interest rates expectations for the major central banks remain mostly unchanged
• UK June mortgage approvals 64.17k vs 63.00k expected
• Deutsche no longer sees any more rate cuts by the ECB, next move to be a rate hike instead
• ECB survey: Inflation expectations 1 year ahead down to 2.6% vs 2.8% prior
• US trade team arrives for second day of talks with China
• Spain Q2 preliminary GDP +0.7% vs +0.6% q/q expected
• EUR/USD tests five-week lows as fallout from US-EU trade deal continues
• FX option expiries for 29 July 10am New York cut
• Reminder: It’s a big week on the earnings calendar
• Heads up: US Treasury to announce more details to their quarterly refunding plans tomorrow
• BOJ likely to resume interest rate hikes, says ex-policymaker
• Mild dollar selling slated for month-end – Credit Argicole
• U.S. Commerce Department yet to approve Nvidia’s export licenses for the H20, sources say.
• China’s Bitmain to launch first U.S. factory amid political tailwinds

It’s been a lacklustre session in terms of economic data and newsflow. The only notable data releases have been the Spanish GDP which beat expectations and the ECB survey on consumer inflation expectations that showed another dip for the 1 year ahead measure.

In terms of price action, we had the US dollar remaining supported across the board, while the stock markets erased some of yesterday’s losses. The other markets remain mostly rangebound as we await the FOMC decision and the key US data like the NFP and CPI.

Meanwhile, we have also the US-China talks in Stockholm as they try to resolve their disputes and de-escalate the trade war further. No major breakthrough is expected but the two sides will likely agree on another 90-day extension to keep the negotiations going and avoid an escalation.

In the American session, we have the US Job
Openings and the US Consumer Confidence coming up. The Job Openings are
expected at 7.500M vs 7.769M prior. The labour market data has been
showing a ‘low hiring, low firing’ environment as businesses have been
potentially waiting for more clarity on tariffs. Now that we have more
of that clarity, it’s going to be interesting to see how the data
evolves.

The US consumer confidence is expected
at 95.0 vs 93.0 prior. We have already seen a bounce from the April
lows as the de-escalation in the trade war gathered pace. This report is
more biased towards the labour market as opposed to the UMich one which
is more skewed towards the consumers’ financial situation

This article was written by Giuseppe Dellamotta at investinglive.com.