The United States of America

USD weakens against JPY, GBP, and EUR.

Investors focus on the publication of June data on the labor market: the unemployment rate fell from 3.7% to 3.6%, while hourly wages increased by 0.4%, more than the forecast of 0.3%. Nevertheless, employment increased by only 209.0K, which is less than both the expectations of 225.0K and the May value of 306.0K, which signals a cooling of the sector and adds uncertainty to the further actions of the US Federal Reserve. It was previously believed that at the next meeting, the regulator would resume raising the interest rate, although more slowly than before, however, with a further slowdown in the labor market and a decline in inflationary pressure, officials may extend the pause in tightening monetary policy.

Eurozone

EUR strengthens against USD but weakens against GBP and JPY.

Investors focus on the latest comments from European Central Bank (ECB) President, Christine Lagarde, who told La Provence newspaper that the regulator would not “stand idly by” if there was a simultaneous increase in corporate profits and wages. Officials have reason to believe that some corporations are raising their prices more than necessary to compensate for high costs, while workers continue to demand higher wages, which together increase inflationary risks. Experts took these statements as confirmation of the department’s intention to maintain the “hawkish” rhetoric. German industrial production data released today showed a 0.2% decline.

The United Kingdom

GBP strengthens against EUR and USD but weakens against JPY.

The Halifax House Price Index for June was released today, rising from –0.2% to –0.1% MoM, less than the forecast 0.1%, and falling from –1.1% to –2.6% YoY versus –2.3% estimate, reflecting the worst rate of decline in the last twelve years. Analysts of the agency expect further deterioration of the situation as the Bank of England maintains its monetary policy tightening. The head of the regulator, Andrew Bailey, accused some retailers of overpricing, which contributes to increased inflationary pressure in the economy, and reiterated that interest rate hikes must continue now to avoid big problems in the future.

Japan

JPY is strengthening against USD, EUR, and GBP.

Published today, the nominal wage for May rose by 2.5% instead of the expected increase of 0.7%, the core average wage rose by 1.8% but the real volume fell by 1.2%. Household spending statistics showed a decline of 1.1% MoM and 4.0% YoY. However, the positive dynamics of nominal wages may convince the Bank of Japan that inflation is steadily reaching its 2.0% target, allowing it to move towards monetary policy tightening.

Australia

AUD is weakening against JPY and GBP but has ambiguous dynamics against EUR and USD.

Due to a lack of significant economic releases, the movement of the asset is driven by external factors. On Monday, investors are awaiting the publication of May data on the volume of building permits issued: according to forecasts, the growth of their total number will increase by 20.6% after falling by 8.1% a month earlier, and building permits for private houses will be corrected by 0.9% after –3.8% in April. Recovery of the real estate sector may strengthen the position of the Australian dollar.

Oil

The morning growth of oil quotes was replaced by a decline.

The prices are supported by the publication of a weekly report from the Energy Information Administration of the US Department of Energy (EIA), according to which the oil reserves decreased by 1.508M barrels, while gasoline inventories decreased by 2.550M barrels, and distillates – by 1.045M barrels. More significant growth of the asset is hampered by the latest data from the US labor market: a slowdown in employment growth may indicate a cooling of the national economy, which may cause a decrease in oil demand in the future.