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There were no fresh headlines to rock the market boat, so traders focused on extending the previous session’s economic themes.

  • AU MI leading index flat in June vs. 0.2% decline in May

Major Events/Reports:

Australia’s leading index report

A while ago we saw the Westpac–Melbourne Institute Leading Index, which indicates the likely pace of economic activity relative to trend three to nine months into the future, fall from +0.05% to -0.33% in June.

As it turned out, the biggest drags came from factors like the unemployment expectations index, commodity prices, and contraction in dwelling approvals.

What’s more interesting is that the recent slowdown has been “significantly influenced by domestic components,” which is a shift from the international factors that influenced the report a year back.

Overall risk appetite

With no new catalyst to price in, Asian session market players concentrated on pricing in market themes from the previous session.

Powell’s bullish speech was still under the spotlight, as his upbeat outlook supported further rate hikes from the Fed. Not a bad thing to hear especially when traders are jittery about a global trade war!

  • Nikkei is up by 0.50% to 22,810.3
  • A SX 200 is up by 0.26% to 6,251.2
  • Hang Seng is up by 0.31% to 28,268.8
  • Shanghai index is up by 0.51% to 2,812.338

Commodity prices also saw gains across the board, though gold barely made gains amidst the overall dollar strength.

  • Gold is up by 0.01% to $1,227.70
  • Brent crude oil is up by 0.39% to $71.84
  • U.S. WTI is up by 0.13% to $67.67

Major Market Mover(s):

USD

Powell’s bullish statements sent two-year Treasury yields to its highest in almost a decade which, together with a technical break on USD/JPY, might have helped the Greenback extend its gains across the board.

USD/JPY is up by 10 pips (+0.09%) to 112.97; USD/CHF is up by 12 pips (+0.12%) to 1.0013; USD/CAD is up by 20 pips (+0.15%) to 1.3210, and EUR/USD is down by 15 pips (-0.13%) to 1.1645.

GBP

The pound took a breather from its losses to recover by a pip or two after yesterday’s bloodbath.

GBP/USD is up by 8 pips (+0.06%) to 1.3106; GBP/CHF is up by 9 pips (+0.07%) to 1.3123; GBP/AUD is up by 13 pips (+0.08%) to 1.7759, and GBP/CAD is up by 15 pips (+0.08%) to 1.7314.

Watch Out For:

  • 8:30 am GMT: U.K.’s CPI report (2.6% expected, 2.4% previous). Read all about the release on our mini trading guide!
  • 8:30 am GMT: U.K.’s PPI input and output
  • 8:30 am GMT: U.K.’s house price index (y/y) (3.8% expected, 3.9% previous)
  • 9:00 am GMT: Euro Zone’s final CPI (y/y) to remain at 2.0% in June?