The week starts on mixed sentiment, as US futures are down, and the US dollar is up this morning.

A mixture of micro and macro events will set the tone for this week and onward, as the earnings season kicks off this week, and the latest US inflation figures will be released, as well.

On the macro front, the US inflation data is expected to print on Wednesday a further advance to 8.8% in June, from 8.6% printed a month earlier. But some factors hint that inflation may have eased, or will start easing soon.

On the micro front, earnings season kicks off to give a concrete insight on how well the US companies deal with rising inflation and stronger US dollar, while some retailer events will give an insight on how consumers feel about spending in the actual rising inflation environment.

In the FX, the US dollar extends its steep rally. The EURUSD almost hit parity last Friday, and is again under pressure this morning. The yen is also weakening as the ruling coalition in Japan extended a majority in last weekend’s upper house elections. The current government is up for more fiscal easing, while the Bank of Japan (BoJ) doesn’t seem in hurry to tighten its purse’s strings. 

This report has been prepared by Swissquote Bank Ltd and is solely been published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any currency or any other financial instrument. Views expressed in this report may be subject to change without prior notice and may differ or be contrary to opinions expressed by Swissquote Bank Ltd personnel at any given time. Swissquote Bank Ltd is under no obligation to update or keep current the information herein, the report should not be regarded by recipients as a substitute for the exercise of their own judgment.

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