EUR/USD

The EUR/USD pair is showing noticeable growth, recovering from the decline during two trading sessions in a row, as a result of which the instrument retreated from local highs of March 21. The single currency is again testing 1.0890 for a breakout, while trading participants expect new drivers of movement to emerge. The focus of investors' attention today is the European Central Bank (ECB) meeting on interest rates, which could launch a new cycle of monetary easing in the eurozone. Analysts expect that the regulator will reduce the interest rate by 25 basis points in response to the active slowdown in inflation and a sharp decline in the economy, which in some regions is teetering on the brink of recession. Trading participants also expect that at a subsequent press conference, the President of the regulator, Christine Lagarde, will indicate the possibility of further reducing borrowing costs until the end of 2024. In addition, April statistics on retail sales in the eurozone will be published today: the indicator is projected to decline in monthly terms by 0.3% after an increase of 0.8% in the previous month, and in annual terms, a slowdown in dynamics from 0.7% to 0.1% is expected. In the US, at 14:30 (GMT 2), the market will receive data on the dynamics of Jobless Claims, and on Friday — the May report on the labor market. For the time being investors are assessing statistics from Automatic Data Processing (ADP) on employment in the private sector, which reflected a decrease in the indicator from 188.0 thousand to 152.0 thousand, with a forecast of 173.0 thousand.

GBP/USD

The GBP/USD pair is strengthening slightly, trying to recover to the local highs of March 14, updated at the beginning of the week: the instrument is testing 1.2800 for a breakout, while the markets are preparing for the publication of the May US labor market report on Friday. Forecasts suggest a moderate increase in Nonfarm Payrolls from 175.0 thousand to 185.0 thousand, and Average Hourly Earnings are likely to increase from 0.2% to 0.3% in monthly terms, while an annualized figure may remain at 3.9%. The Unemployment Rate may also remain around 3.9%. Meanwhile, the day before, May statistics from the Automatic Data Processing (ADP) company were presented, according to which Employment Change decreased from 188.0 thousand to 152.0 thousand, with expectations of 173.0 thousand. In turn, the American currency was supported the day before by data on the Services PMI: in May, the index from the Institute for Supply Management (ISM) rose from 49.4 points to 53.8 points, with a forecast of 50.8 points, and the indicator from S&P Global remained at 54.8 points. The British Services PMI remained at 52.9 points in May, while the S&P Global/CIPS Composite PMI strengthened from 52.8 points to 53.0 points.

AUD/USD

The AUD/USD pair is showing uncertain growth, testing 0.6660 for a breakout. The instrument is moderately supported by macroeconomic statistics from Australia, which partially compensates for the negative data published the day before. The Gross Domestic Product (GDP) in the first quarter in annual terms slowed down from 1.6% to 1.1% with expectations of 1.2%, and in quarterly terms — from 0.3% to 0.1% with forecasts of 0.2%. Today's publications reflected a decline in Exports by 2.5% after –0.6% in the previous month, and Imports by 7.2% after 4.2% previously. Against this background, the trade balance in May increased from 4.84 billion Australian dollars to 6.55 billion Australian dollars, while analysts expected 5.50 billion Australian dollars. The May labor market report will be presented on Friday at 14:30 (GMT 2): it is expected that the data will help clarify the prospects for a possible reduction in borrowing costs by the US Federal Reserve until the end of 2024. The base case scenario currently involves one or two interest rate cuts of 25 basis points each. With a probability of about 60.0%, the first adjustment of the value may take place in September.

USD/JPY

The USD/JPY pair is showing an uncertain decline, correcting after a rather active growth of the instrument the day before, which allowed the instrument to retreat from the local lows of May 16. Quotes are testing 155.80 for a breakdown, while American investors analyze incoming macroeconomic statistics and prepare for the publication of the final report on the US labor market on Friday at 14:30 (GMT 2). The day before, data on Services PMI were presented, which was balanced by a report from Automatic Data Processing (ADP) on employment in the private sector. The Services PMI from the Institute for Supply Management (ISM) rose from 49.4 points to 53.8 points in May, which was significantly higher than market expectations of 50.8 points. The same indicator from S&P Global remained at the same level of 54.8 points. Meanwhile, the ADP report on employment in the private sector adjusted from 188.0 thousand to 152.0 thousand, while analysts expected 173.0 thousand. Another important factor for the American currency was the results of the Bank of Canada meeting on interest rates: as expected, the regulator reduced the rate by 25 basis points to 4.75%, which makes the American currency more attractive for investors against the backdrop of the difference in interest income. In addition, the first adjustment to borrowing costs by the US Federal Reserve is expected no earlier than September. Today, the position of the American currency may be supported by the results of the meeting of the European Central Bank (ECB). The yen remains under pressure despite the Bank of Japan spending heavily in May in an attempt to stem the currency's decline. Meanwhile, analysts do not expect further tightening of monetary policy, expecting inflation to show only moderate growth. Meanwhile, data published yesterday indicated a noticeable increase in Labor Cash Earnings in April from 1.0% to 2.1%, which was better than market expectations of 1.7%.

XAU/USD

The XAU/USD pair is showing moderate growth, testing 2370.00 for a breakout. The instrument is supported by a decline in US Treasury yields as American investors await the emergence of new data that could significantly influence the future decision of the US Federal Reserve on monetary policy. Thus, the day before, trading participants drew attention to the sharp increase in business activity in the US services sector: in May, the PMI from the Institute for Supply Management (ISM) rose from 49.4 points to 53.8 points, with expectations of 50.8 points. In turn, the May report from Automatic Data Processing (ADP) reflected a decrease in employment in the private sector from 188.0 thousand to 152.0 thousand, while analysts expected 173.0 thousand. On Friday at 14:30 (GMT 2) the US will publish final May labor market data, which may reduce the likelihood of an interest rate cut in September. It is assumed that Nonfarm Payrolls will increase from 175.0 thousand to 185.0 thousand, the Average Hourly Earnings is expected to be 0.3% in monthly terms and 3.9% in annual terms, increasing from 0.2% and 3.9%, respectively, while the Unemployment Rate is likely to remain unchanged at 3.9%. In addition, investors continue to monitor the monetary policies of global financial regulators. The day before, the Bank of Canada decided to cut the interest rate by 25 basis points to 4.75%, and today at 14:15 (GMT 2) the focus of traders will be the meeting of the European Central Bank (ECB), which is also expected to reduce borrowing costs by 25 basis points to 4.25%.