U.S. Data in Focus: Markets Reassess Rate Expectations
Markets are awaiting the release of U.S. initial jobless claims and June retail-sales figures. Claims are expected to rise to 235 K from 233 K, while consumer spending is forecast to grow 0.4 % m/m after a flat reading in May. Michael Brown, an analyst at FXStreet, notes: “Any upside surprise in retail sales will reinforce bets that the Fed will keep its hawkish tone.” The U.S. Dollar Index traded this morning at 98.2—up 0.15 %—as traders favored the greenback ahead of the data.
Oil Recovery Lifts Commodity Currencies and Equity Benchmarks
Brent crude climbed to USD 68.76 per barrel (+0.35 %), while WTI rose to USD 66.71 after stronger-than-expected U.S. and Chinese data and hints from President Trump about lowering tariffs on smaller Asian nations. Giovanni Staunovo, a strategist at UBS, said, “An 8.5 % year-on-year increase in Chinese refinery runs signals improving Asian demand.” The Canadian dollar traded at 1.342 against the U.S. dollar, and the S&P 500 Energy sector gained roughly 0.4 % in pre-market futures.
Hot U.K. Inflation Complicates BoE Rate-Cut Bets
U.K. inflation accelerated to 2.8 % y/y, beating forecasts of 2.6 %, prompting investors to scale back expectations of a Bank of England rate cut this autumn. The FTSE 100 fell 0.7 %, led by retail and real-estate stocks, while sterling slid quickly to 1.2730 versus the dollar before trimming losses. Bloomberg analyst Sylvia Dixon remarked, “The hotter-than-expected print complicates the BoE’s task and could spark further volatility in sterling pairs during upcoming sessions.
