- Japan media reports that Tokyo is considering tightening up COVID restricitons
- Goldman Sachs’ 3 reasons warn of a more severe recession in the U.S., U.K., and Canada
- BOJ said to be fully committed to its easing policy. … D’uh
- Shanghai reports a big jump in new COVID cases
- Australian trade balance for May AUD +15,965m (expected +10,725mn)
- PBOC sets USD/ CNY reference rate for today at 6.7143 (vs. estimate at 6.7136)
- China is rolling out new measures to expand vehicle consumption
- USD/JPY poll – forecasts as high as 140. Bank of Japan direct intervention looks unlikely,
- Goldman Sachs on US core CPI comparison to 1970s stagflation
- ING Research sees EUR/USD to reach 0.95 (‘worst case’) on a break of 1.00.
- Bank of Canada to hike by 75 bp in July, then +50 in September (Reuters poll)
- Australian services PMI drops to 48.2 in June (prior was 49.2)
- Japanese media report that the BOJ will raise its view of inflation for 2022 to above 2%
- ICYMI German economy minister said the current energy shortage can lead to recession
- ICYMI – US, allies reportedly discussed capping Russian oil prices as low as $40 a barrel
- FOMC minutes response: “unsurprisingly hawkish”
- Heads of UK & US security services warn of the threat from China.
- US adds Iran shipping and oil companies to sanctions list
- Goldman Sachs forecasts for EUR/USD, GBP/USD & USD/JPY
- Forexlive Americas FX news wrap: ISM services beats, BoJo fights to survive
- Oil – private inventory survey shows a large build in headline stocks (draw was expected)
- Trade ideas thread – Thursday, 7 July 2022
- GameStop (GME) have announced a four-for-one stock split, to take effect July 22
On
the central bank front there were reports from Japanese media on
forecast adjustments expected from the Bank of Japan at its next
meeting (July 20 and 21). The Bank is likely to lower its GDP
projections but will probably raise its quarterly price
projection to its target level of 2% or above for the year ending
next March from the 1.9% view it gave in April. The BOJ has been
repeating, many times, that it sees above-target CPI as transitory.
And that it is committed to its loose monetary policy.
Popping
up in the headlines again is coronavirus. Shanghai reported a jump in
cases today. Tokyo is considering the reintroduction of some curbs.
Data.
Australia’s May trade balance surged to a record surplus. Resource
exports led the way. Coal surpassed iron ore in the month. LNG was
also very strong. This comes of course as offshore clients seek
alternatives to oil as best they can (and Russian sources). Imports
surged also, a positive sign for domestic demand.
USD/JPY
popped briefly above 136.00in the early hours but has since dropped
back to lows circa 135.60.
AUD,
NZD, CAD, GBP and even the hapless euro added a few points against
the USD. There was a shudder when the Shanghai COVID count news
crossed, but it was short-lived.
Oil is little net changed on the session: