The upcoming week will be dominated by the European Central Bank (ECB) interest rate decision, United Kingdom (UK) inflation and labor market data and preliminary global Purchasing Managers Index (PMI) data. Australian employment, New Zealand inflation and Canadian CPI data will also attract attention.
The US Dollar Index (DXY) is trading slightly higher near 100.80 after a mixed United States (US) economic release. The United States (US) calendar will be relatively light, leaving the greenback sensitive to Federal Reserve (Fed) expectations, global risk sentiment and developments in energy markets.
US initial jobless claims are expected to rise slightly to 212K from 208K on Thursday. On Friday, the focus will turn to preliminary S&P Global PMIs and New Home Sales. The previous composite PMI stood at 51.9, with manufacturing at 53.9 and services at 51.2. Strong activity data could support the US dollar, while weak data could extend its recent decline.
US dollar price today
The table below shows the percentage change in the US Dollar (USD) against the major currencies listed today. The US dollar was the strongest against the Australian dollar.
| USD | EUR | gbp | JPY | scurvy | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | 0.06% | 0.17% | 0.03% | -0.20% | 0.20% | -0.00% | -0.15% | |
| EUR | -0.06% | 0.12% | -0.04% | -0.28% | 0.16% | -0.06% | -0.22% | |
| gbp | -0.17% | -0.12% | -0.17% | -0.40% | 0.02% | -0.17% | -0.35% | |
| JPY | -0.03% | 0.04% | 0.17% | -0.23% | 0.18% | -0.04% | -0.19% | |
| scurvy | 0.20% | 0.28% | 0.40% | 0.23% | 0.42% | 0.21% | 0.06% | |
| AUD | -0.20% | -0.16% | -0.02% | -0.18% | -0.42% | -0.22% | -0.38% | |
| NZD | 0.00% | 0.06% | 0.17% | 0.04% | -0.21% | 0.22% | -0.16% | |
| CHF | 0.15% | 0.22% | 0.35% | 0.19% | -0.06% | 0.38% | 0.16% |
The heat map shows the percentage change of major currencies against each other. The base currency is selected from the left column, while the quote currency is selected from the top row. For example, if you select US Dollar from the left column and move to Japanese Yen along the horizontal line, the percentage change displayed in the box will represent USD (base)/JPY (quote).
EUR/USD is trading below 1.1440 ahead of the busy Eurozone calendar. German producer inflation will be released on Monday, followed by Germany’s ZEW survey and the European Central Bank (ECB) bank credit survey on Tuesday. German economic sentiment is expected to improve to 18.0 from 10.5, while the Current Situation Index is forecast to rise to -77.8 from -81.0.
The ECB is expected to leave its main refinancing operating rate unchanged at 2.40% and the deposit facility rate at 2.25% on Thursday. Investors will closely scrutinize policy statements and press conferences for guidance on inflation and potential additional rate hikes. Early French, German and eurozone PMIs on Friday will provide further evidence about the region’s economic momentum.
GBP/USD is trading below 1.3450 with Sterling facing several important domestic releases. Earnings excluding bonuses are expected to rise 3.4% in Tuesday’s labor report, while earnings including bonuses are projected to rise 4.5%. Employment is projected to increase by 100K, the unemployment rate will remain at 4.9%.
Inflation in Britain will continue on Wednesday. Core CPI is expected to decline to 2.5% from 2.6% year-on-year, while headline inflation stood at 2.8% earlier. Retail sales and preliminary PMI will be released on Friday. A rising inflation or wages report could strengthen expectations that the Bank of England (BoE) will maintain restrictive policy, while weak employment and consumption data could put pressure on the pound sterling.
USD/JPY is near 162.50, with the market alert to the possibility of intervention by Japanese authorities. Japan’s trade report expects exports to increase by 18.6% and imports to increase by 21.0%, reducing the overall trade deficit to about 120 billion yen.
Japanese inflation will also be closely watched at the end of the week. The CPI excluding fresh food is projected to rise 1.4% to 1.6% annually. Strong inflation could support expectations of additional tightening by the Bank of Japan (BOJ) and provide some relief to the Japanese Yen.
AUD/USD is trading near 0.6980 ahead of Wednesday’s Australian labor market data. Employment is expected to increase by 15 thousand in June, sharply slower than the previous increase of 40.3 thousand, while the unemployment rate is projected to remain unchanged at 4.4%.
Australian preliminary PMIs will be out on Thursday. The previous composite PMI stood at 50.4, manufacturing at 51.5 and services at 50.5. China’s interest rate decision on Sunday will also be relevant to the China-sensitive Australian dollar, with the People’s Bank of China expected to keep its benchmark rate unchanged at 3.0%.
West Texas Intermediate (WTI) oil is trading near $82 a barrel, up nearly 3% as supply concerns remain heightened due to geopolitical risks. Oil will remain sensitive to developments in the Middle East and preliminary global PMIs, which could impact future energy demand expectations.
Gold moved near $4,015 due to geopolitical uncertainty and demand for defensive assets. However, stronger global activity or inflation data could push government bond yields higher and limit the precious metal’s recovery.
Economic perspective of hope: voices on the horizon
Tuesday, July 21:
Friday, July 24:
Central banks meetings and upcoming data releases
The People’s Bank of China will announce its interest rate decision on Sunday, July 19, with the benchmark rate expected to remain unchanged at 3.0%.
The ECB will announce its monetary policy decision on Thursday, July 23. The main refinance operating rate is expected to stand at 2.40%, while the deposit facility rate is expected to stand at 2.25%. The policy statement will be followed by a press conference by ECB President Christine Lagarde.
