EUR/USD

The EUR/USD pair shows near-zero dynamics, consolidating near 1.0785. Market activity remains subdued as trading in the US is closed today due to the Independence Day holiday. Tomorrow at 14:30 (GMT 2), the June labor market report will be presented, which could significantly influence the US Federal Reserve's decisions on monetary policy. According to forecasts, Nonfarm Payrolls in June will decrease from 272.0 thousand to 190.0 thousand, the average hourly earnings — from 4.1% to 3.9% in annual terms and from 0.4% to 0.3% on a monthly basis, and the Unemployment Rate will remain unchanged at 4.0%. Meanwhile, the day before, the single currency managed to demonstrate quite active growth, which was the market reaction to data from the United States. a report from Automatic Data Processing (ADP) on employment in the private sector in June reflected a decrease from 157.0 thousand to 150.0 thousand, while analysts expected 160.0 thousand, the Services PMI from Institute for Supply Management (ISM) fell from 53.8 points to 48.8 points with a forecast of 52.5 points, and Factory Orders in May decreased by 0.5% after increasing by 0.4% a month earlier, while the experts expected the positive dynamics to remain at the level of 0.2%. Meanwhile, data from the eurozone indicated a further slowdown in inflation, which increases the risk of a new interest rate cut by the European Central Bank (ECB): the Producer Price Index in May lost 0.2% after –1.0% in the previous month, with an expected 0.1%, and in annual terms the figure was –4.2% after –5.7% with preliminary estimates of –4.1%.

GBP/USD

The GBP/USD pair is consolidating near 1.2745 and local highs from June 13, updated the day before. Market activity is subdued today as trading floors in the US are closed for Independence Day celebrations. In addition, traders are monitoring the progress of the parliamentary elections that have started in the UK: the party that receives the majority of seats will be able to appoint a new prime minister of the country and form a renewed government. At the same time, opinion polls indicate that the opposition forces and, in particular, the Labor Party, will be able to win a landslide victory over the Conservatives led by the current Prime Minister Rishi Sunak. In turn, American traders drew attention to the sharp drop in the Services PMI from the Institute for Supply Management (ISM) in June from 53.8 points to 48.8 points, while analysts expected 52.5 points. At the same time, the indicator from S&P Global adjusted from 55.1 points to 55.3 points with neutral preliminary estimates. In addition, the minutes of the June meeting of the US Federal Reserve were published the day before, which did not cause a response from the market, which many associated with the speech of the Chair of the regulator, Jerome Powell, the day before. As expected, the minutes recorded the cautious position of the Fed's officials on the issue of launching a program to reduce borrowing costs. Most of the meeting participants noted that at the moment additional information is needed that would confirm a decrease in inflation to the target 2.0%.

AUD/USD

The AUD/USD pair is showing moderate growth, building on the upward momentum formed on Tuesday. The instrument is testing 0.6715 for a breakout, while trading participants evaluate the May data on the dynamics of Australian foreign trade, which reflected an increase in Exports by 2.8% after a decline of 2.2% in the previous month, and Imports by 3.9% after –7.0%. Against this background, the trade surplus fell from 6.68 billion Australian dollars to 5.77 billion Australian dollars, while analysts expected the value to remain unchanged. The day before, the Australian currency was supported by data on retail sales and building permits. Retail Sales in May added 0.6%, accelerating from 0.1%, while experts expected 0.2%, and the Building Permits increased by 5.5% after 1.9% a month earlier with preliminary estimates at 1.6%. In addition, the Commonwealth Bank Services PMI rose from 51.0 points to 51.2 points in June, contrary to the forecast of 50.6 points. Trading sites in the US are closed today on the occasion of Independence Day, so the focus of investors' attention is now only on the June labor market report, which will be published tomorrow at 14:30 (GMT 2). Analysts expect a slowdown in Nonfarm Payrolls from 272.0 thousand to 190.0 thousand, and Average Hourly Earnings are likely to decline from 4.1% to 3.9% in annual terms and from 0.4% to 0.3% — monthly.

USD/JPY

The USD/JPY pair is showing mixed trading, holding close to 161.50. The instrument reached record highs the day before, and today it is influenced by technical factors and reduced trading volumes due to the celebration of US Independence Day. At the same time, macroeconomic statistics were published the day before, which failed to support the "bulls" in their desire to update record highs for the instrument. Among other things, they drew attention to the sharp decline in the US Services PMI from the Institute for Supply Management (ISM) in June from 53.8 points to 48.8 points, with the expected 52.5 points, and the similar indicator from S&P Global adjusted from 55.1 points to 55.4 points, while analysts expected no change. In turn, Factory Orders in May lost 0.5% after increasing by 0.4% in the previous month. For comparison, the Manufacturing PMI in Japan decreased from 49.8 points to 49.4 points, despite the fact that the regulator’s monetary policy remains quite soft: officials only once raised the interest rate to zero, and also resorted to new foreign exchange interventions in late April and early May. At the same time, the yen showed only short-term growth, after which it again reached record lows. In July, further steps are expected from the Bank of Japan towards tightening monetary parameters: in particular, in addition to borrowing costs, the regulator may weaken control over bond yields. However, analysts note that such actions may not be enough for the yen to rise, and the situation now can be largely influenced only by the decisions of the US Federal Reserve, which may adjust the interest rate by 25 basis points in September.

XAU/USD

The XAU/USD pair is consolidating near 2355.00, awaiting new movement drivers. Activity will remain subdued today as US markets are closed for Independence Day celebrations. Tomorrow at 14:30 (GMT 2), the June labor market report will be presented, which could significantly influence the US Federal Reserve's decisions on monetary policy. According to forecasts, Nonfarm Payrolls in June will decrease from 272.0 thousand to 190.0 thousand, the average hourly earnings — from 4.1% to 3.9% in annual terms and from 0.4% to 0.3% on a monthly basis, and the Unemployment Rate will remain unchanged at 4.0%. Speaking at the European Central Bank (ECB) forum in Sintra, US Federal Reserve Chairman Jerome Powell confirmed that for now officials are taking a wait-and-see approach to interest rate adjustments, while carefully assessing further risks of the balance between containing inflation and the worsening situation in the labor market. The official forecasts of the American regulator suggest one and a half full reduction in borrowing costs by 25 basis points by the end of the year from the current 5.50% to 5.10%, while analysts expect one or two adjustments before the end of 2024, the first of which may take place already in September.