The USD holds steady, oil prices strengthen, equity markets are mixed, and US yields are up as the US-Iran halt hostilities. The U.S. dollar holds steady in early trading, remaining close to 13-month highs and on track for its strongest monthly gain since July 2025, supported by expectations of further Federal Reserve rate hikes and continued confidence in the U.S. economy. Markets now turn their attention to this week's U.S. labour market data and developments in U.S.-Iran talks for fresh direction. Global equity markets are mixed, with U.S. futures and most Asian markets trading higher while European equities edge lower as investors assess the outlook for interest rates, geopolitical developments and corporate earnings. AI-related technology stocks remain in focus following recent volatility, while attention is beginning to shift toward this week's key U.S. labour market data for further direction. Elsewhere, oil prices are higher after renewed U.S.-Iran hostilities over the weekend raised concerns about the ceasefire's durability and shipping security through the Strait of Hormuz. Gold prices are weaker as safe-haven demand eases, while Bitcoin extends its recovery amid improving market sentiment. Today sees a light economic calendar, with only the ECB President's speech providing intraday guidance for currency markets.
News headlines. Comcast announces it will spin off media and tech wins into separate public companies. AI fuels record $200bn M&A boom in US power sector. The US says it has reached an agreement with Iran to halt strikes and resume talks. China grounds light aircraft after Beijing tower crash. Andy Burnham sets out a '10-year mission' to raise living standards. Putin admits Ukrainian drones are causing 'problems'. US envoy insists Trump 'did not take aim' at Canada with tariff policies, rhetoric. Venezuela quakes push the fragile health system to the brink. Google Cloud to offer specialist AI models for science research.
In currency markets. This week, markets will focus on the ECB Forum in Sintra, where comments from ECB President Christine Lagarde and Federal Reserve Chair Kevin Warsh will be closely watched for fresh guidance on the interest rate outlook. Attention will also turn to Friday's U.S. employment report, which could shape expectations for further Federal Reserve rate hikes in the second half of the year.
In commodity markets. Oil +1.00% | Nat Gas -0.98% | Gold -1.15% | Silver -0.35% | Copper -0.54% | Palladium +0.09% | Coffee -0.48% | Cocoa -1.37% | Soybeans -0.60%
CAD is holding relatively steady, straddling 1.42, with traders reluctant to take large positions ahead of the July 1 virtual trilateral meeting between Canada, the U.S. and Mexico, which marks the formal start of the six-year CUSMA/USMCA review. Investors are watching closely for any signals on trade policy, as the talks could influence the outlook for North American supply chains and Canadian exports.
EURCAD is firmer in early trading as the euro benefits from a softer U.S. dollar, while the Canadian dollar remains constrained by caution ahead of the July 1 virtual CUSMA review meeting between Canada, the United States and Mexico. Attention now turns to the ECB's Sintra forum and Friday's U.S. employment report, with both events expected to drive the pair's near-term direction.
EUR is steady in early trading, with EUR/USD holding around 1.1400 as a softer U.S. dollar offsets cautious sentiment while investors monitor developments in U.S.-Iran talks. Attention now turns to the ECB's annual Sintra forum, where President Christine Lagarde's remarks will be closely watched for clues on the policy outlook, ahead of Friday's U.S. June employment report. For now, EUR/USD is expected to remain range-bound, with guidance from central banks and incoming economic data likely to determine the next directional move.
GBPEUR is flat in early trading as sterling remains resilient despite ongoing political uncertainty surrounding the UK's next Chancellor. However, expectations that the Bank of England may not tighten policy as much as markets currently anticipate could support the euro, leaving GBPEUR vulnerable to modest downside pressure in the near term.
GBP is firmer in early trading, with the pound edging higher ahead of Andy Burnham's closely watched speech on his economic plans and any indication of who he will appoint as finance minister. While sterling has come under pressure this month from a stronger U.S. dollar and political uncertainty, investors will also be watching this week's U.S. employment report and comments from Fed Chair Kevin Warsh for further direction.
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