Euro Boosted, Japanese Yen Weakens, Chinese Market Cheers

Market Reviews

The single currency has significantly reinforced to become the strongest as 28 EU leaders reached consensus over the migration issue. Aussie rose to trade as the second firmest. Chinese stock market staged some broad gains. Shanghai composite grew 1.2%. Hong Kong HSI rose 1.15%. Singapore Strait Times increased 0.7%. Japanese Yen weakened to trade as the softest. Greenback is weak as well. Spot Gold hit the minimum of 1246.11 but then lifted to 1250. WTI crude oil extended its rally to 73.42 high.

European Council promised to strengthen policies that “prevent a return to the uncontrolled flows of 2015″ in immigrants. And it will further “stem illegal migration on all existing and emerging routes.” The leaders also said Donald Trump’s tariffs “cannot be justified on the grounds of national security”. And European Council “fully supports the rebalancing measures, potential safeguard measures to protect our own markets, and the legal proceedings at the WTO, as decided on the initiative of the Commission”. Leaders also claimed they will “respond to all actions of a clear protectionist nature”.

James Bullard (St. Louis Fed President) told “hearing full-throated angst” when asked about US-China trade tension. The President also said that “all aspects of the economy are affected, but agriculture is certainly being hit.”

Andy Haldane (BoE chief economist) claimed his vote in favor of the rate hike at the last week’s meeting was “hardly either surprising or radical”. He explained that even after rising rates to 0.75%, monetary conditions in Britain would remain ” extraordinarily accommodative by any historical metric”. That’s why, the raise would “lower the risk of needing to tighten policy less gradually in future and cause a sharper adjustment in the economy.” The chief economist sounded confident and optimistic about consumption and household spending.

New Zealand building permits were up 7.1% mom in May. British Gfk consumer confidence declined to -9 in June. Japanese unemployment rate fell to its 25-year minimum of 2.2%. Tokyo Consumer Price Index grew to 0.7% yoy. Industrial production reduced -0.2% mom in May. Housing starts lifted 1.3% yoy. Consumer confidence dropped to 43.7 in June. As of today’s data, Swiss will release KOF, Germany will feature unemployment, Britain will publish mortgage approvals, current account and Final Gross Domestic Product of Q1, Eurozone will present Consumer Price Index, US will announce personal income and spending, PCE inflation, Chicago PMI and Canada will release GDP, IPPI and RMPI and BoC business outlook survey.