JASPER’S MARKET SQUAWK 30-06-2023

<h2>Strong US Data Outweigh PCE Revision</h2>
<p>US Core PCE came in lower than expected, while the final Q1 GDP was revised higher, causing the market to see-saw, but ultimately dollar and equities ended higher, assisted by firm bank stress results.</p>
<p><img decoding="async" loading="lazy" class="alignnone wp-image-23948 size-full" src="https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-38.png" alt="" width="1919" height="915" srcset="https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-38.png 1919w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-38-300×143.png 300w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-38-1024×488.png 1024w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-38-768×366.png 768w, https://www.keytomarkets.com/blog/wp-content/uploads/2023/06/Untitled-design-38-1536×732.png 1536w" sizes="(max-width: 1919px) 100vw, 1919px" /><em><strong>Chart: XUS30</strong></em></p>
<h2>Key Factors For Today</h2>
<ul>
<li>Dollar ends higher as core PCE comes in lower than expected, but Q1 GDP revised up</li>
<li>Weekly jobless claims drop and banks pass Fed’s stress test add to risk sentiment</li>
<li>Yen hits 7-month low against the dollar, opening speculation for BOJ action</li>
<li>German CPI for June exceeds expectations, while Spain falls within ECB’s target</li>
<li>NZ Consumer Confidence survey shows significant rise, pointing to inflation relief</li>
</ul>
<h2>Strong US Data Boost Dollar</h2>
<p>Markets reacted to the Core PCE downward revision from 5% to 4.9%, but stronger economic growth increased speculation that stricter monetary policy was on tap. The final read of the US Q1 GDP was revised to 2.0% annualised growth compared to 1.4%, helping the dollar get a boost. Weekly jobless claims came off from an 18-month high, as they experienced the largest drop in 20 months. Meanwhile, all banks passed Fed’s stress test without any negative surprises, adding to risk sentiment and sending the Dow 0.53% higher to 34120. 34270 is resistance, while support falls into the 33-34k zone.</p>
<h2>Yen Falls into “Rate Check” Territory</h2>
<p>The yen hit a 7-month low against the dollar, briefly hitting the level that last year prompted the BOJ to initiate a “rate check”, opening speculation for when such action might be retaken. The rate check is a precursor to the Ministry of Finance intervening in the market to prop up the currency. USD/JPY spiking to 145.10 early Friday has brought some price action, opening up 144.00 unless bulls attempt 145.52.</p>
<h2>German CPIs Above Estimates Ahead of EA Figures</h2>
<p>Hours ahead of the Euro-wide CPI data coming out, the preliminary German annual CPI for June increased to 6.4% compared to the 6.3% expected and above the 6.1% reported in May. Spain was also above expectations at 1.9% compared to 1.7% expected but was the first EU state to fall within the ECB’s 2% target. The core rate, however, was reported at 5.9%, compared to the 5.5% expected and down slightly from the 6.9% prior. EUR/USD slid 0.47% to $1.0862, exposing $1.0824. Conversely, $1.0913 makes good resistance under $1.09642.</p>
<h2>Kiwi Consumer Confidence Well Above Expectations</h2>
<p>ANZ June Consumer Confidence survey rose to 85.5 compared to 79.2 in May, the highest reading since the start of the year. Analysts point to relief on inflation, with expectations of price growth falling and a growing sentiment that house prices are stabilising. The New Zealandian currency is seen targeting the 61-cent barrier early Friday, with support above $0.6037 at $0.6070.</p>
<h2>On The Docket</h2>
<ul>
<li>UK GDP Growth Rate</li>
<li>French Inflation Rate</li>
<li>German Unemployment</li>
<li>EA Inflation Rate</li>
<li>Canada GDP</li>
<li>PCE, Core PCE</li>
<li>Michigan Consumer Sentiment</li>
<li>BoC Business Outlook Survey</li>
<li>UK Housing Prices</li>
<li>European Council Meeting</li>
</ul>
<h2>FX 1-Day Relative Performance (USD)</h2>
<ul>
<li>Aussie and Kiwi 0.31% and 0.48% higher</li>
<li>Euro and Pound up by 0.10% and 0.18%</li>
<li>Yen 0.03% higher, Franc up by 0.11%</li>
<li>Canadian dollar up by 0.06%</li>
<li>Gold 0.06 lower, while silver 0.25% up</li>
<li>WTI unchanged, while brent 0.34% higher</li>
<li>Natural gas 0.44% lower</li>
</ul>
<p>The post <a rel="nofollow" href="https://www.keytomarkets.com/blog/analysis/jaspers-market-squawk-30-06-2023-23944/">JASPER’S MARKET SQUAWK 30-06-2023</a> appeared first on <a rel="nofollow" href="https://www.keytomarkets.com/blog">Key To Markets Blog</a>.</p>