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Brexit, COVID-19, and U.S Weekly Jobless Claims in the Spotlight

Earlier in the Day:

It was a relatively quiet start to the day on the economic calendar. The Pound and the Aussie Dollar, by proxy, were in focus in the early part of the day.

Away from the economic calendar COVID-19 and geopolitics continued to be a major source of angst for the markets.

Looking at the latest coronavirus numbers

On Wednesday, the number of new coronavirus cases rose by 222,368 to 12,130,571. On Tuesday, the number of new cases had risen by 227,176. The daily increase was lower than Tuesday’s rise while higher than 210,499 new cases from the previous Wednesday.

Germany, Italy, and Spain reported 986 new cases on Wednesday, which was up from 776 new cases on Tuesday. On the previous Wednesday, 1,062 new cases had been reported.

From the U.S, the total number of cases rose by 62,416 to 3,162,416 on Wednesday. On Tuesday, the total number of cases had increased by 67,655. On Wednesday, 1st July, a total of 51,607 new cases had been reported.

Out of China

June’s inflation figures were in focus this morning. China’s annual rate of inflation picked up from 2.40% to 2.5%. Economists had forecast an annual rate of inflation of 2.50%. Month-on-month, consumer prices fell by 0.1%, following a 0.8% decline in May. Economists had forecast a 0.5% decline.

Wholesale deflationary pressures eased marginally in June, with the producer price index falling by 3% year-on-year. In May, the index had fallen by 3.7%. Economists had forecast a 3.2% decline

At the time of writing, the Aussie Dollar was down by 0.07% to $0.6977.

Elsewhere

At the time of writing, the Japanese Yen was down by 0.07% to ¥107.34 against the U.S Dollar, with the Kiwi Dollar down by 0.09% to $0.6569.

The Day Ahead:

For the EUR

It’s a relatively quiet day ahead on the economic calendar. Germany’s trade data for May will be in focus later this morning.

Barring a further narrowing in the trade surplus, however, the data should have a relatively muted impact on the EUR.

Expect updates from Brexit talks, COVID-19 and geopolitics to be the key drivers on the day.

At the time of writing, the EUR was up by 0.04% to $1.1334.

For the Pound

It’s a particularly quiet day ahead on the economic calendar. There are no material stats due to provide the Pound with direction.

A lack of stats leaves the Pound in the hands of Brexit as talks resumed on Wednesday. Any agreement on EU access to Britain’s fisheries and expect the Pound to jump.

Earlier in the day, June’s RICS House Price Balance figures had a muted impact on the Pound. The RICS House Price Balance survey showed that a net balance of -15% of respondents saw some degree of house price decline over the survey period. This was an improvement from a net -32% of respondents in May. Economists had forecast a net balance of -25%.

At the time of writing, the Pound was flat at $1.2610.

Across the Pond

It’s also a quiet day ahead for the U.S Dollar. Later today, the weekly jobless claims figures will draw plenty of attention. While nonfarm payrolls have impressed, the weekly claims numbers continue to raise red flags…

Another sizeable jump and the markets may need to question the upbeat sentiment towards the labor market recovery.

Away from the economic calendar, expect COVID-19 news and any chatter from Washington to also influence on the day.

At the time of writing, the Dollar Spot Index was up by 0.07% to 96.493.

For the Loonie

It’s another quiet day ahead on the calendar. May building permit figures are due out of Canada later today.

We don’t expect too much influence from the numbers, however.

Risk sentiment will remain the key driver as the markets begin to consider the Bank of Canada’s monetary policy decision next week.

At the time of writing, the Loonie was down by 0.04% to C$1.3517 against the U.S Dollar.

For a look at all of today’s economic events, check out our economic calendar.