In the European session, we don't have much on the agenda other than a couple of low tier releases like the Italian Retail Sales and the Eurozone PPI. These indicators won't change anything in terms of market pricing.

In the American session, we have the ECB Policy Decision and the US Jobless Claims data. The ECB is widely expected to cut by 25 bps and bring their policy rate to 2.00%. The central bank is also expected to communicate a pause at least until September as they gather more information.

The market is pricing in 55 bps of easing by year-end, so the terminal rate is around 1.75%. The decision is likely to be a non-event given that pretty much everything is already priced in and widely expected.

The US Jobless Claims continue to be one of the most important releases to follow every week as it’s a timelier indicator on the state of the labour market. Initial Claims remain inside the 200K-260K range created since 2022, while Continuing Claims continue to slowly drift higher.

This week Initial Claims are expected at 235K vs. 240K prior, while Continuing Claims are seen at 1910K vs. 1919K prior.

Central bank speakers:

  • 07:45 GMT/03:45 ET - BoE's Greene (neutral - voter)
  • 16:00 GMT/12:00 ET - Fed's Kugler (dove - voter)
  • 16:35 GMT/12:35 ET - BoC's Kozicki
  • 17:30 GMT/13:30 ET - Fed's Schmid (hawk - voter)
  • 17:30 GMT/13:30 ET - Fed's Harker (neutral - non voter)
Source: Forex Live