It is deadline for Greece as markets (again) eagerly await the news that their negotiators have presented a real proposal to creditors. Chinese shares have recovered overnight following another disastrous sell-off on Wednesday and relative calm has set in before the North American session opens. Here in the US, traders are hopeful there will not be another “accidental” glitch at the New York Stock Exchange and everyone’s attention can be centered upon the bigger issues that continue to be Greece and China. Yesterday, the minutes from the latest Federal Reserve meeting were released and struck a more dovish tone. The US dollar lost a bit of ground in the hours that followed as Fed voters remain cautious about the prospect of higher rates while keeping a keen eye on outside conflicts affecting sentiment Stateside. Other safe haven currencies – namely the franc and yen – are lower and peripheral European yields fell as a bit of positivity spread on this Thursday Deadline Day.
Overnight, data was sparse save for German trade balance and another non-event Bank of England policy meeting. Britain’s central bank once again held the headline rate firm at 0.50% and QE levels remain at 375 billion pounds, while Germany’s trade surplus dipped in June, down to €19.5b from €21.8b in May. Markets largely ignored the news and maintain fixated on headlines. Asian trading did provide some relief to the downtrodden Aussie dollar, rising on the encouraging news their economy added 7,300 new jobs in June versus expectations of a 5,000 reduction. Unemployment in Australia remained at 6.0% while the participation rate ticked up to 64.8%. The Aussie has seen heavy selling of late, taking a big hit over the last month as it is heavily correlated to China. If Chinese shares can gain a bit of momentum off of today’s gains, we could see that filter through the Aussie dollar.
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