The newswire says that the date had been decided by the German cabinet. It has to be held at the latest by 26 October 2025 and no earlier than 31 August 2025. So, this is right smack in the middle of the expected period in autumn.

This will be the elections for the federal parliament, with 630 seats up for grabs in the Bundestag (as of now). For some context, the last election in 2021 resulted in a „traffic light“ coalition taking charge between the SPD, FDP, and Greens. That broke the previous „grand coalition“ between the SPD and CDU/CSU.

This article was written by Justin Low at www.forexlive.com.

• Prior +3.9%
• Market index 209.3 vs 214.1 prior
• Purchase index 134.8 vs 140.4 prior
• Refinance index 614.9 vs 613.0 prior
• 30-year mortgage rate 6.82% vs 6.87% prior

Mortgage applications fell back in the past week with a drop in purchases activity offsetting a marginal increase in refinancing activity. Overall, it still points to a more subdued sentiment in the US housing market.

This article was written by Justin Low at www.forexlive.com.

Crude oil has been under
sustained pressure since the beginning of July. Things got even worse as
Trump’s odds of winning soared after the failed assassination attempt. He is a
great supporter of the “drill, baby, drill” slogan and he will likely put an
end to the war in Ukraine if he gets elected.

Those should be bearish
drivers for crude oil as expectations of increased supply could give the buyers
a hard time for new cycle highs. On the macro side, we haven’t seen much change,
on the contrary, the latest US data continue to show a resilient economy with even
some pickup.

So, we now have some bearish
drivers on the supply side but bullish drivers on the demand side. Overall, it
shouldn’t give conviction for huge moves on either side and the market will
likely continue to trade in a range.

Crude Oil
Technical Analysis – Daily Timeframe

On the daily chart, we can
see that crude oil broke through the key 80 support zone and extended the drop into the 77 level
as the sellers piled in more aggressively while the buyers folded.

We can
expect the buyers to step back in around this level with a defined risk below
it to position for a rally back into the key 80 level. The sellers, on the
other hand, will want to see the price breaking lower to increase the bearish
bets into the 72.50 level next.

Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can
see that we have a strong support around the 77 level as we can also find the 61.8%
Fibonacci retracement level for confluence. We have also a minor downward trendline
defining the current bearish momentum.

If the price were to break
higher, the buyers should gain some more confidence and increase the bullish
bets into the 80 level. The sellers, on the other hand, will likely keep on
leaning on the trendline to position for a break below the 77 support.

Crude Oil Technical Analysis – 1 hour Timeframe

On the 1 hour chart, we can
see that the price is now around the trendline. This is where the sellers will
look for a rejection and a drop into new lows, while the buyers will look for a
breakout to the upside. The red lines define the average daily range for today.

Upcoming
Catalysts

Today we have the US Flash PMIs. Tomorrow, we will get the latest US Jobless
Claims figures. Finally, on Friday we conclude the week with the US PCE report.

This article was written by Giuseppe Dellamotta at www.forexlive.com.

The decision on whether to hike rates will be a „close call“ and a „hard one to make“, according to one of the sources. Another said that it will be more of a „judgment call“ in terms of whether to act this month or wait until later in the year. But one thing is for sure is that they will unveil plans of tapering bond purchases at a gradual pace, with the thinking to halve it in the coming years.

Going back to the rate decision, the sources say that while the BOJ board agrees on the need to raise interest rates in the short-term, there is no consensus on when that might take place.

The key uncertainty is that domestic consumption is in a relatively weak spot and the outlook is still shrouded with doubt at the moment. The sources note that as policymakers take that into consideration, they could lean towards the choice of not rushing into hiking rates for now.

The details are certainly not as hawkish as what the headline might suggest I would say.

But in any case, I want to point something out about the recent price action in the Japanese yen. The currency has been strengthening in the past few days and it looks to be some flows tied to anticipation ahead of the BOJ meeting next week.

In that lieu, we might end up with a sell the fact trade regardless of what the BOJ does at the end of the day.

If they don’t hike, traders will take that as a more dovish decision. And if they do, overall policy is still very accommodative and they might not much scope to go with another one in September and/or October at least.

This article was written by Justin Low at www.forexlive.com.

But alas, the ECB has to keep their focus on inflation pressures first and foremost. If growth expectations were the main argument, there would be a strong reason to push with a rate cut in September after the PMI data earlier. Instead, the situation now presents a bit of a headache for the central bank.

The economy is starting to slow down again after a resilient showing in Q1, followed by marginal growth in Q2. However, there hasn’t been too much progress on the inflation front over the last two to three months especially.

The disinflation process remains relatively gradual at best and one might even argue that it is stalling somewhat as of late.

Even from the PMI data today, HCOB noted that:

„Prices data did not provide hope for relief. Input prices in the services sector increased at a faster rate and selling prices rose at a similar pace to the previous survey period. To make things worse, input prices in manufacturing, which fell for more than a year between March 2023 and May 2024, have now increased for two months straight. Output prices fell only fractionally, which may make it more difficult for overall inflation to make the necessary progress towards the 2% target. Our conclusion is that while a September rate cut will most probably be exercised, it will be much trickier to follow this path in the months thereafter, unless the downturn morphs into a deep recession.“

The ECB might just be stubborn enough to still cut rates again in September. However, they might run into a wall in trying to cut rates another time later this year.

The current market pricing shows ~44 bps of rate cuts for the year. And if it were to be a one and done case, there will be some repricing to do in markets.

In turn, that might offer a minor tailwind for the euro. That being said, if inflation pressures are holding higher while the economy continues to suffer later in the year, I fear that such prospects will outweigh everything else for the single currency. Can anyone say stagflation?

That’s a serious risk to consider and might leave a scar on the euro and regional assets as we get deeper into the second half of the year.

This article was written by Justin Low at www.forexlive.com.