OCBC’s Sim Moh Siong and Christopher Wong expect Asian FX to start the week on a softer footing as AI-led equity losses and renewed US–Iran tensions keep the Dollar bid.

United States Dallas Fed Manufacturing Business Index down to 0 in June from previous 0.4

Commerzbank analysts Charlie Lay and Dr. Henry Hao highlight that China’s industrial profit growth slowed to 21.1% year-on-year in May, with weaker consumption and investment pointing to easing momentum.

TradingKey - Devido ao feriado do Dia da Independência dos EUA em 3 de julho, o relatório de emprego não agrícola (payroll) de junho, originalmente agendado para sexta-feira, será divulgado antecipada

Financial markets could find an important catalyst in the enchanting, fairytale-like landscape of  Sintra this week. The European Central Bank (ECB) Forum will, as it does every year, gather the crème de la crème of central banks.

ING’s Global Head of Macro Carsten Brzeski warns that recurring European heatwaves are becoming a structural drag on Eurozone growth. He cites academic and ECB research showing measurable losses in output and higher food inflation linked to extreme temperatures.

Rabobank's Senior FX Strategist Jane Foley discusses EUR/USD within a broader reassessment of Dollar drivers. Foley notes that even if the US Dollar (USD) is in long-term decline, cyclical forces can still support it.

Guntermann at Commerzbank notes that while Oil prices near pre-war levels reduce tail risks for growth, inflation and rate volatility, Euro area inflation is not falling fast enough to dispel European Central Bank (ECB) hawkishness.

United Kingdom (UK) Greater Manchester Mayor Andy Burnham has stated during the European trading session on Monday that his plans after getting the leadership position would be consistent with Labour’s 2024 manifesto.

India Cumulative Industrial Output increased to 5.1% in May from previous 4.1%

India Industrial Output rose from previous 4.9% to 5.1% in May

India Manufacturing Output declined to 5.5% in May from previous 6.2%

ING strategist Frantisek Taborsky notes that a stronger Dollar and lower Oil have led markets to outprice most rate hikes in Poland and the Czech Republic, adding pressure on regional FX.

Belgium Consumer Price Index (YoY) down to 3.4% in June from previous 4.08%

Belgium Consumer Price Index (MoM): 0.3% (June) vs -0.08%

Iranian Deputy Foreign Minister Kazem Gharibabadi has stated in a post on X, formerly known as Twitter, that Tehran has concluded a meeting with Oman in which review current issues related to the Strait of Hormuz, a critical chokepoint to almost 20% of global energy supply.

Eurozone Consumer Confidence meets expectations (-17.7) in June

ING’s Francesco Pesole expects the European Central Bank’s Sintra forum to maintain a broadly hawkish stance, with President Lagarde unlikely to signal a dovish shift ahead of June CPI.

United Kingdom M4 Money Supply (YoY) declined to 4.3% in May from previous 4.5%

United Kingdom Net Lending to Individuals (MoM) below forecasts (£6B) in May: Actual (£4.6B)

Portugal Consumer Confidence: -25.9 (June) vs -27.1

United Kingdom M4 Money Supply (MoM) came in at 0.1%, below expectations (0.2%) in May

Portugal Business Confidence up to 2.8 in June from previous 2.7

United Kingdom Mortgage Approvals registered at 56.21K, below expectations (63K) in May

United Kingdom Consumer Credit: £1.662B (May) vs previous £1.859B

Commerzbank’s Guntermann highlights the Sintra forum as a key event for European Central Bank (ECB) communication, with Lagarde’s opening speech and a heavyweight policy panel midweek.

Lloyd Chan at MUFG notes broad depreciation across Asia FX since the June FOMC meeting, driven by widening swap differentials and sustained high US rates. The bank keeps a defensive bias on selective Asia currencies.

European Central Bank (ECB) Governing Council member Mārtiņš Kazāks said during the European trading session on Monday that the possibility of negative scenarios in the Eurozone has fallen massively.

Eurozone Private Loans (YoY) up to 3.1% in May from previous 3%

Francesco Pesole at ING highlights the Pound’s resilience despite shifting expectations around the next United Kingdom (UK) Chancellor, with markets seemingly relaxed about fiscal risks.