The EUR is the strongest and the JPY is the weakest as the North American session begins.The USD is mixed to lower. Gains and losses are generally modest.

The EURUSD is moving to the upside after a non-trend-like day yesterday to start the trading week. The price today has moved back above the 100/200 hour MA (blue and green lines on the chart below).

Overnight, Chinese Premier Li Qiang assured the global economic community that China’s economic growth is set to rebound in the second quarter of 2023, expected to reach the annual growth target of around 5%. Despite a faltering momentum that led several senior banks to downgrade their growth estimates for China, Li promised to implement more practical and effective measures to stimulate the economy, potentially alleviating concerns of investors worldwide.

In Russia, President Vladimir Putin is dealing with a challenging situation involving the Wagner group of mercenaries. During a televised address, Putin assured that steps were taken to avoid serious bloodshed, although the fate of the group’s chief, Yevgeny Prigozhin, remains unclear.

Attention is also being paid to a high-profile gathering in Portugal, where central bankers from around the globe, including President Christine Lagarde of the European Central Bank (ECB), are meeting to discuss pressing economic matters.

Today central banker comments focused on inflation

ECB’s Gediminas Simkus:

• A rate hike in September shouldn’t be ruled out.
• Too early to definitively say if there will be a rate hike in September.
• Central bank must keep rates restrictive to reach a 2% inflation target.

BOE’s Swati Dhingra:

• There has been a promising sharp drop in Producer Price Index (PPI).
• Typically, there is a lag of one or two quarters between a fall in PPI and Consumer Price Index (CPI).
• Food prices are the area where inflation remains most stubborn.
• It’s not convincing to argue that UK grocery inflation is driven by “greedflation”.

ECB’s Christine Lagarde:

• ECB is committed to reaching the inflation target no matter what.
• It’s necessary to bring rates to a “sufficiently restrictive” territory.
• ECB will communicate clearly that it will maintain the restrictive rates as long as necessary.
• The full impact of the cumulative rate hikes since last July has not been fully seen.
• It’s not possible to confidently say that rates have peaked.

Highlighting the importance of this meeting, there will be a panel discussion tomorrow at 9:30 AM ET featuring key central banking figures. This panel will include Kazuo Ueda from the Bank of Japan (BOJ), Christine Lagarde from the ECB, Andrew Bailey from the Bank of England (BOE), and Jerome Powell from the U.S. Federal Reserve. The insights shared by these top officials will be closely watched by the global financial community, given the significant influence their policies and perspectives have on world markets.

In the United States, futures markets are mixed after yesterday’s declines (two days lower) as investors eagerly await a slew of economic data. Walgreen Boots shares are lower after announcing worse than expected earnings this morning. Shares are trading at $29.24 down over 7.5% on the day.

At 8:30 AM, Canada will release several important Consumer Price Index (CPI) data. The Median CPI year on year is expected to be at 4.0%, down from the previous 4.2%. The Trimmed CPI year on year is anticipated to be 3.9%, a slight decrease from the previous 4.2%. The Common CPI year-on-year is forecasted to be 5.4%, down from 5.7%. The Core CPI month-on-month data will also be released, with the last figure standing at 0.5%. Lastly, the CPI month on month is expected to be 0.4%, down from the previous 0.7%. Simultaneously, in the United States, the Core Durable Goods Orders month on month are expected to be at 0.0%, up from the last -0.3%. The Durable Goods Orders month on month are anticipated to decrease by -0.8%, compared to the last increase of 1.1%.

At 9:00 AM, the United States will also release the Housing Price Index (HPI) month on month, which is expected to be at 0.5%, slightly lower than the last 0.6%. Additionally, the S&P/CS Composite-20 HPI year on year is expected to be -2.5%, indicating a further drop compared to the last -1.1%.

At 10:00 AM, the United States will release the CB Consumer Confidence data, forecasted at 103.9, slightly higher than the previous 102.3. New Home Sales are anticipated to be at 677K, down from the last 683K. Lastly, the Richmond Manufacturing Index is expected to show an improvement, forecasted at -12 compared to the last -15.

A snapshot of the markets currently shows:

• Crude oil is trading down $-1.51 or -2.18% at $67.86
• Spot gold is trading little changed at $1922.77
• Silver is up $0.10 at $22.86
• Bitcoin is trading higher at $30,725.

In the premarket for US stocks, the major indices are trading mixed in premarket trading (Dow is lower on the back of Walgreen Boots earnings miss):

• Dow Industrial Average is trading down -51.71 points after yesterday’s -12.72 decline
• S&P index is trading up4.4 points after yesterdays -19.51 point decline
• NASDAQ index is trading up 47 points after yesterday’s sharp fall of -156.74 points.

In the European equity markets, the major indices are mixed

• German DAX down -0.22%
• France’s CAC -0.21%
• UK’s FTSE 100 -0.26%
• Spain’s Ibex +0.25%
• Italy’s FTSE MIB unchanged (delayed)

In the Asian Pacific market today, Japan and Australia is indices fell. China was closed for holiday:

• Japan’s Nikkei fell -0.49%
• Australia’s S&P/ASX 200 index rose 0.56%
• China’s Shanghai composite index rose 1.23%
• Hang Seng index rose 1.88%

In the US debt market yields are marginally higher

• 2-year yield 4.689%, +1.8 basis points
• 5-year yield 3.977%, +1.3%
• 10-year yield 3.725%, +0.6 basis points
• 30-year yield 3.816%, -0.3 basis points

In the European debt market, benchmark 10-year yields are little changed:

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