Last week in the markets we had the FOMC minutes that gave us insight into whether they will start the rate hiking cycle this year they also gave forward guidance to what indicators they will be following which are employment, inflation and growth indicators. The dollar ended the week higher on that note. In the Euro area, we had the latest CPI reading and the monthly unemployment rate. Core inflation, which strips out the prices of food, energy, alcohol and tobacco, was estimated to have risen 1.0% on a year earlier, Eurostat said. The forecast-beating result is a significant acceleration on June’s figure of 0.8% and the quickest rate since April 20. The jobless rate held at 11.1% in June. Unemployment was mixed across the euro area’s largest economies in June, with rates holding at 4.7% in Germany and 10.2% in France, while rising to 12.7% in Italy and falling to 22.5% in Spain. Germany had the lowest unemployment rate at 4.7% while Greece had that highest at 25.6% in April. A total of 17.756 million people were registered as unemployed in the month, up slightly from 17.725 million in May.14.
This week is a big week we have Nonfarm payrolls on Friday and the BOE minutes, Inflation report flowed by a press conference with BOE chair chairman Mark carney on Thursday. We also have key risk events today which is the ISM PMI report. This report gives us the first indication into the health of the US economy throughout July. It will be closely watched by investors because the ISM PMI’s give outlooks for the business condition this report also gives insights into inflation and employment trends. (Which could give us an indication for where NFP is heading) After following wild swings in the market last week, the EURUSD closed below the key 1.10 level which keeps sentiment is favour of dollar strength
Short term uptrend