Eurozone Inflation, Powell, and Bailey in Focus as July Trading Begins

Hello traders, welcome to Tuesday, the first trading day of July — a month that historically tends to favor stocks. We’re starting this month with optimism in the air, supported by upbeat sentiment across major indices and a packed macroeconomic calendar that could set the tone for the days ahead.

Let’s quickly revisit Monday. The key print of the day was Germany’s preliminary CPI, which came in at 0% versus the expected 0.2%. Despite this miss, the euro held firm and even gained ground throughout the session, signaling that markets may be more focused on broader risk appetite than single data points.

Now, looking at today’s agenda — it’s a big one. We are awaiting flash CPI figures for the entire Eurozone, with expectations set at 2%. Inflation readings will be closely watched for any signs that could influence the ECB’s next policy steps.

Additionally, central bankers take center stage today. Markets are preparing for remarks from three major figures: Bank of England Governor Andrew Bailey, Bank of Japan Governor Kazuo Ueda, and U.S. Federal Reserve Chair Jerome Powell — all of whom are scheduled to speak at the ECB Forum on Central Banking. Their comments could shape expectations for monetary policy in the second half of the year.

In the U.S., we also await the ISM Manufacturing PMI, expected at 48.8, and JOLTS job openings data, forecast at 7.3 million. Both releases could provide deeper insights into the health of the U.S. economy heading into the Fed’s next move.

It’s worth noting that Canadian markets are closed today in observance of Canada Day, which may thin out volumes during the North American session.

From a market perspective, the week began with strong gains. U.S. indices pushed toward all-time highs on Monday, with European equities following, albeit at a slightly slower pace. Futures are showing a modest correction this morning, but overall sentiment remains bullish.

In the FX space, the Japanese yen and Swiss franc are showing strength — though not necessarily due to a full-blown flight to safety, as risk assets like equities remain supported. The biggest underperformers so far today are the Australian dollar, the euro, and the U.S. dollar.

Over in commodities, gold is powering higher, continuing the strong upside move seen during the Asian session. Other metals, including copper, palladium, and platinum, are also showing impressive gains. Meanwhile, oil is trading flat for now as traders await fresh headlines or catalysts to determine its next leg.

Source: https://www.axiory.com/analytics/market-news/eurozone-inflation-powell-and-bailey-in-focus-as-j