Market News

Ahead of the European Central Bank’s decision, which will be keenly watched by investors and analysts alike, the Euro paused from its latest rally which took the common currency more than 2% higher versus the US Dollar.

At an emergency meeting Tuesday, Greece’s creditors outlined yet another agreement to help the leftist government in Athens put its country out of its dire financial situation.

This morning’s release of CPI figures from the Eurozone was an unexpected and welcome surprise for Euro bulls. According to Eurostat, May’s personal inflation or CPI reading, though preliminary, rose to 0.3% against expectations of a rise to 0.2% from 0.0% in April.

There were no surprises when Australia’s Central Bank Governor Glenn Stevens and his board left its key interest rate unchanged Tuesday at a record low of 2.0. Despite the decision, the Australian dollar continued to rise.

As had been largely expected, the Greek government was unable to meet a deadline for an agreement with lenders to release additional aid. Without that funding, it is highly unlikely that Greece will be able to make its next IMF payment which comes due on June 5th.

Greece is no closer to reaching a deal with its creditors with each side pointing to the other as the reason for the failure.

There is quite a lot of data coming out this week, which should be dominated by USD news (in particular, Friday’s NFP report) and also to a lesser extent statements by the central banks of the Eurozone, the U.K., and Australia. However it seems very unlikely there will be any surprises from the central banks so all eyes will be on the USD data.

Data released on Friday showed that the U.S. economy contracted in the first quarter of the year but despite the drop on Wall Street, indexes still posted gains for the month.

Chinese shares came back slightly on Friday after plunging drastically the day before, but couldn’t prevent investors from remaining skeptical that the equity market was turning around.

Investors, speculating that interest rates in the United States are likely to rise higher this year, helped to push the U.S. Dollar to a multi-year peak versus the Japanese Yen.

Australia released its business capital expenditure (CAPEX) report Thursday and it wasn’t promising.

The US Dollar eased back versus the Japanese Yen and the Euro after a short bout of investor profit taking which came in the wake of improved US data. That economic data had gone a long way to help restore some waning confidence in the greenback.

When Federal Reserve Chair Janet Yellen reiterated her expectations to raise interest rates this year for the first time since 2006 she put smiles on the faces of her peers at central banks around the world.

Last week’s release of inflation data helped to push the US Dollar Index higher and lifted the greenback to an 8-year peak versus the Japanese Yen.

Crude oil seems to be making a comeback. With prices rebounding significantly over the last few weeks, traders are jumping back in with expectations of continued gains.