Waves of data headed into independence day weekend

Wells Fargo Research Team Wells Fargo

Weekly Economic & Financial Commentary

U.S. Review

Waves of data headed into independence day weekend

Total payrolls rose by 4.8 million and the unemployment rate fell to 11.1%. Another step in the right direction, but employment remains nearly 10% below the February peak.
Initial jobless claims slightly fell to 1.4 million for the week ending June 27. Continuing claims came in at 19.3 million for the week ending June 20. Processing issues may be overstating the numbers, but claims remain highly elevated nevertheless.
The ISM manufacturing index blew past expectations during June, rising to a 14-month high of 52.6. The surge likely reflects relief about reopening rather than a full rebound in activity.

Global review

Q2 Set to Be a Tough Quarter for Most Global Economies

It was a mildly busy week for foreign economic data and events, while global COVID-19 cases continued to rise.
China’s PMIs beat market expectations in June as the manufacturing and services PMIs as well as the Caixin manufacturing PMI strengthened and remained above the breakeven 50 level.
Data out of Canada were less encouraging, however. Economic activity fell sharply in April as strict COVID-19 lockdown measures weighed on growth.
Finally, the Riksbank caught market participants off guard by delivering a SEK200B increase in its QE program.

Download the full special commentary

Author

Wells Fargo Research Team

Wells Fargo

EUR/USD holds firm near 1.1850 amid USD weakness

EUR/USD remains strongly bid around 1.1850 in European trading on Monday. The USD/JPY slide-led broad US Dollar weakness helps the pair build on Friday's recovery ahead of the Eurozone Sentix Investor Confidence data for February.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold remains supported by China's buying and USD weakness as traders eye US data

Gold struggles to capitalize on its intraday move up and remains below the $5,100 mark heading into the European session amid mixed cues. Data released over the weekend showed that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Fed expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Cardano steadies as whale selling caps recovery

Cardano (ADA) steadies at $0.27 at the time of writing on Monday after slipping more than 5% in the previous week. On-chain data indicate a bearish trend, with certain whales offloading ADA. However, the technical outlook suggests bearish momentum is weakening, raising the possibility of a short-term relief rebound if buying interest picks up.

Japanese PM Takaichi nabs unprecedented victory – US data eyed this week

I do not think I would be exaggerating to say that Japanese Prime Minister Sanae Takaichi’s snap general election gamble paid off over the weekend – and then some. This secured the Liberal Democratic Party (LDP) an unprecedented mandate just three months into her tenure.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.