EUR/USD: The Unstoppable Climber
For the sixth straight day, the EUR/USD has been marching up the chart like a determined dog chasing its tail—except this time the tail is money. It’s currently hovering around 1.0820, and if you’re wondering why the euro keeps doing its upward jig, stick around.
What’s Brewing in the Economic Kitchen?
- European Retail Sales – The EU is aiming to show a 0.2% bump in May, bouncing back from a dip the month before.
- U.S. Non‑Farm Payrolls – Forecasts anticipate a decline to 190,000 jobs this June, a drop from 272,000 last month, with unemployment steady at 4.0%. Average hourly earnings are expected to cool to 3.9% from 4.1%.
These numbers could send the markets on a merry‑go‑round, but the euro seems to be holding its breath, quietly funnelling through the noise.
U.S. Markets Re‑wake from the Independence Day Snooze
The U.S. markets have kicked off trading after the holiday lull, and activity is set to flare up. Think of it as a huge party where everyone finally gets up after a long nap.
German Factory Orders: Not Exactly a Fiery Start
Germany’s factory orders fell by -1.6% in May, a break from the previous month’s -0.2%. The euro’s climb above 1.0800 was buoyed by a weaker dollar, helping the pair edge forward.
French Politics: A Flick of the Far‑Right Keyboard
With the National Rally led by Marine Le Pen snatching the upper hand, the French parliament is gearing up for a September shuffle. President Macron’s centrist coalition, along with left‑wing allies, likely won’t back the far‑right in more than 200 seats, creating a fragile coalition that could send French bond yields sprinting toward record highs.
In my view, the shrewd moves to sidestep an outright far‑right takeover have steadied the euro, keeping the decline on pause. Investors fear that a new government could roll out expansive fiscal policies that might wobble the already shaky French finances.
ECB Inflation: A Poised Target at 2%
The Eurozone’s inflation numbers are on track toward the ECB’s 2% goal, nudging ties toward a faster rate cut. The latest inflation report shows the annual consumer price index fell to 2.5%, while the core index (excluding volatile items) stayed steady at 2.9%.
In essence, services seem to be the engine driving growth. Manufacturing shrank in June, yet the service sector kept marching with almost the same vigor as before. Preliminary PMI data hint that service firms will likely keep steering the region’s performance for the coming year.
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