It’s been a pretty boring session in terms of news and data releases. The only data we got were the final Spanish CPI and the US NFIB Small Business Optimism Index. The Spanish CPI was revised higher, while the US NFIB saw a notable drop in sentiment due to the US-Iran war.
The market reaction was rather muted to both releases as traders remain focused on US-Iran negotiations given that the outcome will shape future growth and inflation expectations.
On the news front, we just got further reports confirming a second round of US-Iran talks later this week. It’s not yet clear when, but most reports are looking for Thursday onwards.
This optimism is keeping the markets in risk-on mode as the US dollar stays on the backfoot, stocks continue to get bid, oil prices remain under pressure and precious metals extend the gains on easing financial conditions.
In the American session, we get the weekly US ADP jobs data and the US PPI. The weekly ADP data hasn’t been a market-moving release, but it’s been pointing to a resilient and even improving labour market.
The US PPI is unlikely to be a market-moving report, much like the US CPI last Friday, because everyone knows it’s going to be hot due to the US-Iran war. That’s old news. What matters now is what happens with the US-Iran negotiations.
