Major currencies are looking rather muted and understandably so. Today will be more of a placeholder trading day with it being a US holiday. That makes for kind of a weird week as we have a bit of a recess in the middle.
The dollar is keeping more mixed overall on the week while risk sentiment is staying more optimistic, at least in Wall Street. Tech shares continue to drive stocks higher but we’ll get a bit of a breather today.
Looking to European trading, UK inflation is the main item on the agenda. We’ll be getting the numbers for May and the estimates show that headline annual inflation is expected to fall back to the 2.0% level. But it’s a bit too late to convince the BOE to move tomorrow at least, that especially after the hotter numbers in April here.
Core annual inflation and services inflation remain key sticking points that are countering the argument for sooner rate cuts by the BOE. As things stand, traders are seeing ~47 bps of rate cuts for the year with the odds of a move in September at ~91%. An August move is only ~44% priced in currently.
In any case, sterling will be one to watch in the session ahead at least with the inflation data in focus.
0600 GMT – UK May CPI figures0800 GMT – Eurozone April current account balance1100 GMT – US MBA mortgage applications w.e. 14 June
That’s all for the session ahead. I wish you all the best of days to come and good luck with your trading! Stay safe out there.
This article was written by Justin Low at www.forexlive.com.
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