The EUR/USD is recovering after early session weakness. The Forex pair moved higher on reports that a Greek debt deal was likely to be announced shortly. There is still a little lingering uncertainty because Greece’s creditors are denying the reports. Today’s price action is very similar to last week’s movement when the Euro moved higher on similar rumors of an imminent deal.
The Forex pair opened lower after Greece missed a self-imposed deal deadline Sunday evening. Helping to underpin the market, however, was a report on German manufacturing activity in May which met trader expectations. German Final Manufacturing PMI came out at 51.1.
The GBP/USD was under pressure after the U.K. Manufacturing PMI report missed its estimate. The report showed a reading of 52.00, below the estimate of 52.7.
August Comex Gold futures weakened after the lower Euro and British Pound triggered a rally by the U.S. Dollar.
July Crude Oil futures are trading steady to better. Last week’s inventory drawdown is helping to underpin the market, but traders are still watching the rig count. Traders want to see if drillers are putting more wells on line because this will lead to increased U.S. production.
The major concern for crude oil traders is this week’s June 5 OPEC meeting. The cartel is expected to announce that it is going to keep production at current historically high levels. The market could break on the news especially if this week’s U.S. Energy Information Administration report shows an increase in supply. This will be an indication that U.S. drillers are once again producing and have accepted the market at current price levels.
In other news, the U.S. PCE Price Index report showed a reading of 0.1%, missing the 0.2% estimate. Personal Income disappointed with a 0.0% reading. Traders were looking for a reading of 0.2%. Personal Income, however, beat the 0.3% estimate with a reading of 0.4%.
U.S. Final Manufacturing PMI was slightly below the estimate at 54.0. ISM Manufacturing PMI was higher than the 51.9 estimate at 52.8. Construction Spending soundly beat the estimate with a 2.2% reading. Traders were looking for a reading of 0.7%. ISM Manufacturing Prices also beat the estimate with a 49.5 reading.
This could prove to be a volatile week for currencies and commodities because of the impending news regarding Greece’s debt, and the June 5 U.S. Non-Farm Payrolls report and OPEC meeting.
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