European FX Open - Pressure on Biden intensifies

GBP/USD starts the day firmer.

Latest less than dovish BOE speak via Haskel, Pill and Mann have proved a broad GBP prop ahead of the return of major UK data releases.

At the top of the hour, UK monthly May GDP will likely garner most interest, expected at 0.2% m/m vs 0.0% the month previous. Also scheduled are expected positive monthly IP and MP reads, while the trade deficit is also expected to narrow in May.

Worth noting overnight the June RICS house price balance missed expectations, staying at -17, but the professional body added British home sales will probably rebound as buyers draw more confidence that interest rates will fall and the uncertainties of last week's general election pass.

Sticking with the UK, Bbg reports Chancellor of the Exchequer Reeves faces the prospect of a budgetary hole of around Gbp 30bln that would hinder the ability of the UK s new government to fix the country s ailing public services.

In the second half, the main event. US CPI for June is seen at 0.1% m/m and 3.1% y/y vs 0.0% and 3.3% the month previous. Topside momentum is expected to be weighed down by a large seasonally adjusted decline in gasoline prices. Cores are seen little changed at 0.2% m/m and 3.4% y/y respectively, with the potential disinflation process supported by weighed used cars and recreation.

Central banks wise, the Fed's Bostic and Musalem are due after hours.

The USD is largely softer ahead, as once again the press report UK President Biden faced mounting opposition within his own Democratic party yesterday. Vermont Democrat Welch became the first sitting senator to directly endorse replacing the 81-year-old president whose disastrous debate performance has raised concerns about his mental acuity and thrown his reelection bid into tumult. And, Axios reported majority leader of the US Senate Chuck Schumer privately signaled to donors he s open to replacing Biden as the nominee, while Gretchen Whitmer told CNN 'it wouldn't hurt' for him to take a cognitive test.

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