• USD/JPY knocks on the door of intervention territory
• Japan’s Matsuno says closely watching FX moves with high sense of urgency
• Eurozone June preliminary CPI +5.5 vs +5.6% y/y expected
• France June preliminary CPI +4.5% vs +4.6% y/y expected
• Germany May retail sales +0.4% vs 0.0% m/m expected
• Germany May import price index -1.4% vs -1.4% m/m expected
• UK June Nationwide house prices +0.1% vs -0.3% m/m expected
• China reportedly surveyed some foreign banks about dollar deposit rates
• RBA to raise cash rate by 25 bps to 4.35% next week – Reuters poll
• What is priced in for the RBA policy decision next week?

Markets:

• GBP leads, CAD lags on the day
• European equities higher; S&P 500 futures up 0.3%
• US 10-year yields up 1.6 bps to 3.870%
• Gold down 0.1% to $1,905.63
• WTI crude down 0.1% to $69.76
• Bitcoin up 1.2% to $30,775

And just like that, we’re about to reach the halfway point for the 2023 year.

The session itself was decent as there were some economic releases to digest but nothing too impactful at the end of the day. Of note, euro area headline annual inflation dropped further in June but core annual inflation ticked a little higher. On the balance of things, that still vindicates the more hawkish posture by the ECB at least.

The euro itself is just a touch lower on the day, as the dollar is sitting more mixed across the board. EUR/USD is down 0.1% to 1.0850 with the range for the day still rather narrow.

On the dollar, the currency itself has seen plenty of pushing and pulling in the last six months. But so far this year, the dollar index itself is ending up little changed. And I would argue that speaks to the resilience of the greenback considering how many were calling for its head amid anticipation of a Fed policy pivot.

Looking to today, USD/JPY did rise to just above 145.00 in Asia but is now little changed around 144.70. Traders are having to weigh up intervention risks, so perhaps there is some element of profit-taking as well.

In the equities space, stocks are keeping some enthusiasm towards the end of the week. European indices and US futures are higher but there is still the final month-end/quarter-end stretch to deal with later. Despite last week’s setback on growth worries, equities have enjoyed a good month in June.

Have a pleasant weekend, everyone. And I’ll catch you guys again next week.

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