03.07.29 - 07.07.02
Results of the previous week
| VIX +9.04% | BRN +4.00% | WHEAT +1.37% |
CERS -13.69% | FDAX -3.38% | COCOA -2.97% |
US benchmark indices started the second half of the year with a downward correction. Markets are still concerned about the global economy. In addition, it should not be forgotten that the world's major central banks continue to raise interest rates, which acts as a dampening factor for growth. In particular, according to CME Group, the probability of a US Fed rate hike at the July meeting is estimated at 89.9%.
The currency market recorded mixed dynamics. The US dollar declined slightly against the British pound and the Japanese yen, which was largely due to a technical correction. At the same time, the commodity currencies: Australian, New Zealand and Canadian dollars suffered losses against their American counterparts. Fears of a downturn in the global economy are weighing on them.
Brent (BRN) oil prices are still within the 71.90–78.00 range. Last week, they moved towards its upper boundary. The growth is supported by news of production cut plans in Saudi Arabia and Russia. In addition, Saudi Arabia's state-owned oil and gas company Saudi Aramco raised August selling prices for Asian, US and European buyers.
Key events of the current week
Germany. ZEW Indicator of Economic Sentiment | DATE 11.07 | GMT | FORECAST | PREV. | IMPORTANCE |
Germany's economy has entered a recession. GDP has already fallen in year-on-year terms. The disruption of supply chains, the rise in the cost of energy and other raw materials have affected the situation in key sectors of the economy. Naturally, economic sentiment is also worsening as a result. The indicator returned to negative territory, indicating pessimistic sentiment about the economy's prospects over the next six months. And the forecasts indicate that these sentiments are set to continue. The negative dynamics of the indicator puts pressure on the common European currency. Should the report come in line with forecasts, EUR/USD could return to the 1.0760 level. | |||||
The US. Inflation rate | DATE 12.07 | GMT | FORECAST | PREV. | IMPORTANCE |
The US Federal Reserve has raised the rate to its highest since 2006. This has undoubtedly helped to reduce inflation. But, be that as it may, the level of price pressure is still two times the target set by the regulator. And Fed officials, according to the minutes of the last meeting, are mostly in favour of further tightening. If the inflation rate matches or exceeds the forecast, it will increase the chances that the Fed will raise rates again in July. Such expectations support the dollar.In this case, USD/JPY will continue to move towards the 145.00 level amid opposing views on monetary policy from the US and Japanese central banks. | |||||
The UK. GDP growth rate | DATE 13.07 | GMT | FORECAST | PREV. | IMPORTANCE |
The UK economy remains highly vulnerable. The business activity index for the industrial sector has been in decline since August 2022. Despite repeated rate hikes by the Bank of England, the country's inflation rate has so far failed to fall significantly and remains at 8.7%. The actions of the regulator, coupled with rather expensive energy prices, are having a negative impact on GDP growth. The indicator shows a decline. This decline is projected to continue. Deteriorating economic indicators are acting as a deterrent to the Bank of England against raising rates more decisively. And it is negative for the British pound.Against this backdrop, the GBP/USD pair will aim for a move towards the 1.2600 level. | |||||
