European FX Open - A potential EURO day

A potential EURO day with the EMU CPI estimate for June scheduled, forecast at 2.5% y/y vs 2.6% the month previous.

The core is also seen a touch lower at 2.8% y/y vs 2.9% last.

We are also expected to hear from the ECB's Guindos, Elderson and Schnabel this morning. And in the second half, the Bank's president Lagarde and Fed chair Powell are scheduled from Sintra.

Overnight, Lagarde stated the ECB doesn't yet have sufficient evidence that inflation threats have passed, again indicating the governing council will pause this month after cutting for the first time in the cycle in June.

EUR/USD, meanwhile, stays nearer the downside extreme of its approximate 1.06 - 1.10 2024 range, with Monday's French election result inspired relief high of 1.0776 providing the latest tentative lower top.

Bbg reports leaders of France's biggest political groups have been reaching out to voters from across the political spectrum as the battle for the second round of the French legislative election turns into a mad scramble for parliamentary seats.

Elsewhere, Fed's Goolsbee is also slated, while Minutes from last month's June RBA meeting showed the board saw the case to hold interest rates at a 12-year high in June as the 'stronger one' as recent data hadn't been sufficient to change its long-held assessment that inflation would return to target by 2026. The RBA added the Bank need to remain 'vigilant' to upside risks to inflation and reiterated it was 'difficult either to rule in or rule out' future policy moves.

Back to politics, sources suggest the Democrats are poised to formally nominate Biden as early as mid-July. The president has called on voters to 'render a judgment' on Trump after the Supreme Court ruled the ex-president has some immunity from criminal charges from trying to overturn the 2020 election and Trump is believed to be pushing to get his New York conviction tossed out.

And in other markets, oil is threatening higher albeit just below recent high of Usd 87.22/brl high on an escalation in tensions between Israel and Hezbollah in the Middle East and concerns over the rapid start to the Atlantic hurricane season.

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