Review of the dollar, euro, pound, yen, aussie and gold prices for July 1, 2021


The European currency demonstrates a moderate decline against the US dollar during the Asian session, developing the downward dynamics of the last week and renewing local lows since April 6. The euro is under pressure from the moderate growth of the American currency, which is supported by macroeconomic publications, and is also strengthening on expectations of more active actions from the US Federal Reserve, aimed at a gradual tightening of monetary policy in the country. Macroeconomic statistics from Europe released on Wednesday turned out to be neutral and did not provide significant support to the instrument. Thus, the core consumer price index in the eurozone in June showed the expected slowdown from + 1% y / y to + 0.9% y / y. The general index for the same period corrected from 2% y / y to + 1.9% y / y, which also coincided with analysts’ forecasts. Data from Germany showed a stronger 38,000 decline in the number of unemployed in June after a 19,000 decline last month. Analysts had expected a drop of 20 thousand. The unemployment rate in Europe’s largest economy remained at 5.9%.


The British pound shows a slight decline in pairing with the US dollar in the morning session, again preparing to test the 1.3800 mark for a breakdown downward. The positions of the national currency of the United Kingdom remain quite vulnerable on the eve of the publication of data on the US labor market at the end of the week. Traders’ confidence is fueled by the ADP’s private sector employment report, which was released the day before. So, by the end of June, the figure increased by 692 thousand after an increase by 886 thousand in May. In turn, the UK data contributed to additional selling of the pound. In particular, the revised UK GDP in Q1 2021 was revised downward: from -1.5% q / q to -1.6% q / q. In annual terms, the country’s economy is again losing 6.1% y / y. The focus of investors today is the speech of the head of the Bank of England Andrew Bailey, as well as the publication of the PMI in the UK manufacturing sector from Markit.


The Australian dollar is developing a “bearish” trend, which has developed in the short term. The instrument is updating local lows since June 21, in response to the strengthening of the US currency ahead of the publication of the labor market report for June at the end of the week. In turn, a more confident decline in the AUD / USD pair is hindered by the relatively positive macroeconomic statistics from Australia. Thus, the index of activity in the manufacturing sector from AiG in June rose from 61.8 to 63.2 points. Commonwealth Bank’s manufacturing PMI rose in June from 58.4 to 58.6 on a neutral outlook. Australian exports doubled in May to 6%, while imports climbed 3% after falling 3% in April. The country’s trade surplus in May increased from 8.028 billion to 9.681 billion, while the forecast at the level of 10 billion.


The US dollar is flat against the Japanese yen in Asia, consolidating around record highs since March 2020. On the eve of the American currency showed a steady growth, which was due to the appearance of a moderately optimistic report from the ADP on employment in the private sector. The data released has strengthened confidence in the final report on the US labor market, which will be published this Friday. In turn, the data from Japan were practically ignored by the market. Anyway, industrial production in Japan fell by 5.9% m / m in May after rising by 2.9% m / m in April. Analysts expected negative dynamics to appear, but hoped for only -2.4% m / m. During the morning session, the yen is supported by good statistics on business activity from the Bank of Japan. Thus, the index of large manufacturers Tankan at the end of the 2nd quarter of 2021 increased from 5 to 14 points, which turned out to be worse than the expected values ​​by only 1 point.


Gold prices are showing moderate gains during the Asian trading session, testing the 1775.00 mark for a breakout. The pressure on the quotes is still exerted by the market expectations of strong employment data, which, as many hope, will push the US Federal Reserve towards more aggressive monetary policy in the foreseeable future. The report released yesterday from ADP partially justified these expectations, since the real dynamics turned out to be better than forecasted.

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