The coming week will bring a novel test for major currency pairs as investors return from the US Independence Day holiday and continue to analyze weaker US labor market data. The release of the latest Federal Open Market Committee (FOMC) minutes and unemployment claims numbers will test the resilience of the US dollar (USD).
The US Dollar Index (DXY) is trading lower near the 100.90 price zone and will end the week with a loss of 0.50%. The dollar will now focus on the relatively airy but essential US calendar. Monday will bring the final readings of the S&P Global Services PMI and ISM Services PMI, while Tuesday’s trade balance and Wednesday’s FOMC meeting minutes will be key. Minutes from the Fed’s June meeting, the first under Kevin Warsh, could provide clues as to whether policymakers will continue to stick to their restrictive stance.
Today’s US dollar price
The table below shows the current percentage change of the United States Dollar (USD) against the major listed currencies. The US dollar was strongest against the Japanese yen.
| USD | EUR | GBP | JPY | BOOR | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.04% | -0.06% | 0.16% | 0.15% | -0.17% | -0.14% | 0.04% | |
| EUR | 0.04% | -0.03% | 0.20% | 0.18% | -0.16% | -0.13% | 0.07% | |
| GBP | 0.06% | 0.03% | 0.22% | 0.20% | -0.16% | -0.09% | 0.10% | |
| JPY | -0.16% | -0.20% | -0.22% | -0.01% | -0.37% | -0.33% | -0.12% | |
| BOOR | -0.15% | -0.18% | -0.20% | 0.00% | -0.37% | -0.30% | -0.10% | |
| AUD | 0.17% | 0.16% | 0.16% | 0.37% | 0.37% | 0.07% | 0.25% | |
| NZD | 0.14% | 0.13% | 0.09% | 0.33% | 0.30% | -0.07% | 0.19% | |
| CHF | -0.04% | -0.07% | -0.10% | 0.12% | 0.10% | -0.25% | -0.19% |
The heat map shows the percentage changes of the major currencies relative to each other. The base currency is selected from the left column and the quote currency from the top row. For example, if you select the US dollar from the left column and move along the horizontal line to the Japanese yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).
The EUR/USD rate is rising near the level of 1.1440 and will probably be influenced by the contrast between softer US labor market data and the cautious attitude of the European Central Bank (ECB). Trade and industrial data in Germany and France will also be watched for signs of a continued recovery in activity.
GBP/USD has surged over 1% this week to trade near 1.3350 and is likely to remain sensitive to the broader USD direction. If FOMC minutes show concerns about the labor market, the pair could find support.
USD/JPY is trading near the 161.40 level after hitting a 40-year high of 162.84 earlier this week. The Japanese yen could struggle if the U.S. dollar continues to rise, but softer U.S. data could limit the pair’s upside if market prices continue on a less Fed-restrictive path. Intervention risks may also remain in focus if USD/JPY remains near multi-decade highs.
AUD/USD is trading near the 0.6940 price zone and will keep an eye on China-related sentiment and the broader USD trend. The Australian has recently found support in the form of stronger Australian PMI indices and vivid activity in the services sector in China.
West Texas Intermediate (WTI) crude oil is trading at nearly $68.80 per barrel. Black gold will remain sensitive to supply expectations, geopolitical risks and the upcoming OPEC+ meeting. The recent decline in oil prices back to pre-war levels has eased some inflation concerns, but any change in supply guidelines could quickly return volatility to energy markets.
Gold (XAU/USD) is rising near the $4,175 level and could continue to gain if U.S. yields decline and Fed minutes reinforce expectations that the central bank may not maintain restrictive policy for an extended period of time. However, a stronger rebound of the US dollar may limit the growth dynamics of the precious metal’s prices.
Anticipating the economic outlook: voices on the horizon
Monday, July 6
- Governor Fed Waller
- BoE man
- Schnabel ECB
- President of the ECB Lagarde
- ECB belt
Tuesday, July 7
Wednesday, July 8
Thursday, July 9
- Breeden from the BoE
- President of the ECB Lagarde
- Cipollone from the ECB
Friday, July 10
- President of the ECB Lagarde
- Vujcic from the ECB
Central bank meetings and political decisions
The main policy decision next week will be the announcement of the RBNZ’s monetary policy review and the announcement of the OCR on Wednesday, July 8, with an online media conference also scheduled for later in the day. The FOMC minutes from its June 17 meeting will also be published on Wednesday, while the ECB report on the June policy meeting will be published on Thursday. The BoE’s financial stability report and FPC record will be published on Tuesday. There are no major interest rate decisions scheduled this week from the Fed, ECB, BoE, BoJ, RBA or BoC.
