The start of the week was still about the United States and comments from Obama that a deal is reached to raise the debt limit which affected the market and supported the euro versus the dollar which traded with high volatility.
Investors were worried and the focus was on the vote which was expected late Monday, and jitters were evident especially after the vote was delayed a number of times, and also the deadline is on Tuesday so there is no way out for the United States!
The market’s focus on Tuesday will still be about the debt ceiling debate and how rating agencies rate the move. Avoiding default will be supporting to the sentiment yet already have been priced in the market since the start of the week and accordingly the effect is only temporary as the focus returns to the heavy data and the slowing global recovery, especially the slowing U.S. economy.
At 09:00 GMT the euro area June Producer Price Index is due and expected with 0.1% rise on the month following a drop of 0.2% and on the year to ease to 6.0% following 6.2%.
The United States will release the income report for the month of June at 12:30 GMT, where personal income is expected to rise by 0.2%, compared with 0.3% in May, while personal spending is expected to rise by 0.2%, compared with the prior flat estimate. Core PCE is expected to rise by 0.2% in June, compared with 0.3% back in May, while compared with a year earlier, Core PCE is expected to rise by 1.4%, compared with 1.2% in the prior estimate.