- Japan Finance Minister Aso – Business leaders are gradually losing deflationary mindset.
- Japan’s corporate reforms burnish stocks but bruise JPY.
- Japan Finance Ministry plans to extend deficit-financing measure, “automatic” bond issuance.
- Japan June services PMI 51.8, best in 9-months, May 51.5.
- China June HSBC/Markit services PMI 51.8, 5-month low, May 53.5.
- Foreign CB US debt holdings +$10.922 bln to $3.377 trln July 1 week, Treasury holdings +$11.596 bln to $3.033 trln, agencies -#686 mln to $298.627 bln.
- NY Fed – Swaps with foreign CBs total $635 mln July 1 week, BoJ $520 mln, ECB 115 mln.
- Lipper – US-based stock funds attract $64.4 bln inflows in H1, US-focused funds on track for record annual outflows, munis largest outflows in 19-mos.
- Australia May retail sales +0.3% m/m, +0.5% eyed, April rev -0.1%.
- (0230 ET/0630 GMT) Sweden June PMI services; last 58.2.
- (0315 ET/0715 GMT) Spain June PMI services, 58.0 eyed; last 58.4.
- (0330 ET/0730 GMT) Spain May industrial production, -0.6% m/m eyed; last +2.0% m/m, +1.5% y/y.
- (0330 ET/0730 GMT) Sweden May manufacturing new orders; last +4.4% y/y.
- (0345 ET/0745 GMT) Italy June PMI services, 52.5 eyed; last 52.5.
- (0350 ET/0750 GMT) France June PMI services, 54.1 eyed; flash 54.1.
- (0350 ET/0750 GMT) France June PMI composite; last 53.4.
- (0355 ET/0755 GMT) Germany June PMI services, 54.2 eyed; flash 54.2.
- (0355 ET/0755 GMT) Germany June PMI composite; last 54.0.
- (0400 ET/0800 GMT) Euro zone June PMI services, 54.4 eyed; flash 54.4.
- (0400 ET/0800 GMT) Euro zone June PMI composite, 54.1 eyed; flash 54.1.
- (0400 ET/0800 GMT) Norway June unemployment, 2.8% nsa eyed; last 2.7% nsa, 89.76k sa.
- (0400 ET/0800 GMT) Norway June housing prices; last +7.5% y/y.
- (0430 ET/0830 GMT) UK June PMI services, 57.4 eyed; last 56.5.
- (0500 ET/0900 GMT) Euro Zone May retail sales, +0.1% m/m, +2.3% y/y eyed; last +0.7%, +2.2%.
Key Events Ahead
- US Independence Day observed, market holiday.
- N/A Riksbank financial stability report, Gov Ingves press conference.
- N/A Riksbank DepGov Kerstin, DepGov Floden speak at Almedalan seminar.
- N/A UK GBP0.5/1.5/2.0 bln 1/3/6-month treasury bill auctions.
- (0145 ET/0545 GMT) ECB/Finland CB Liikanen speech at Helsinki EMFF conference.
- (0200 ET/0600 GMT) ECB VP Constancio speech at Vilnius conference.
- (0400 ET/0800 GMT) ECB/Austria CB Nowotny Vienna press conference on optimization report.
- Saturday Riksbank Gov Ingves speech in Stockholm.
- Sunday ECB Coeure in Aix-en-Provence panel discussion.
- Sunday Greek referendum on bail-out.
FX Recap
EUR/USD is supported below 1.1100 levels and currently trading at 1.1091 levels. It has made intraday high at 1.1097 and low at 1.1078 levels. Tsipras said that he is still open to a compromise in order to end any talk of Greece leaving the Euro zone. He assured Greece is seeking a sustainable deal and a solution that will keep them in the Euro zone. Pair is trying to find support around 1.1100 level on somewhat disappointing US payrolls data released yesterday. Services sector PMIs across the Euro area economies will be published today. Initial support is seen around 1.0952 and resistance is seen around 1.1218 levels.USD/JPY is supported around 123.00 levels and posted a high of 123.12 levels. It has made intraday low at 122.80 and currently trading at 123.07 levels. The US dollar struggles for an upper edge over the Japanese currency in the mid-Asian session, with USD/JPY swinging back above 123 handle. The major erased losses and trades flat as traders moved past NFP release and now await Sunday’s Greek bailout referendum. The pair extends its recovery amid low volumes as US markets remain closed today on an Independent Day holiday. Near term resistance is seen at 124.57 and support is seen at 121.48 levels.GBP/USD is supported around $1.5600 levels. It made an intraday high at 1.5621 and low at 1.5601 levels. Pair is currently trading at 1.5606 levels. The Pound found support in local construction data, showing that the sector rebounded in June, from the almost two year low posted in April, according to the latest Construction PMI reading, up to 58.1. Today services PMI report from the UK May is seen ticking up to 57.5 from the 56.5 booked in the previous cycle. Markets now shift their focus towards Greek bailout referendum. Greeks will vote on Sunday, July 5 whether to accept or reject the latest offer by creditors to the Tsipras government aimed at unfreezing €7.2 billion in remaining bailout funds. The Greek vote is expected to spur volatility in to Monday’s trading. Initial support is seen at 1.5565 and resistance is seen around 1.5737 levels.USDCHF is supported above 0.9400 levels and trading at 0.9424 levels and made intraday low at 0.9423 and high at 0.9437 levels. CHF is appreciating after the unfavourable US NFP job data and factory orders. As US markets remain closed today on account of Independence Day holiday, we expect will be limited. Near term support is seen at 0.9341 levels and resistance is seen at 0.9500 levels.AUD/USD is supported below 0.7600 levels and trading at 0.7588 levels. It has made intraday high at 0.7647 levels and low at 0.7565 levels. The Australian dollar was heavily sold-off across the board in Asia after Australia’s May retail sales missed expectations while the April revision also discouraged markets. Australia’s May retail sales came below expectations at +0.3% versus +0.5% market estimates, with last month’s data also revised lower to -0.1% versus 0%. US market will remain close today so market will eye on Greece story. Initial support is seen at 0.7532 and resistance at 0.7738 levels.
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