Data released just now has indicated that production in Britain’s industrial sector grew at a faster than expected pace, while manufacturing production missed market estimates for May. The mixed data has resulted in a muted response in the Pound against the majors. In the session ahead, investors will eye the NIESR GDP estimate for evidence of improved growth momentum for the three months ended June.

Meanwhile, the future of Greece in the European Union is likely to depend on the new reform proposal presented by the Greek Prime Minister at the emergency meeting of European leaders today. Across the Atlantic, trade data scheduled later today will be in focus ahead of tomorrow’s FOMC minutes.

Pound Sterling – UK Markets

The just released data has shown that industrial production in the UK rose unexpectedly on a monthly basis for May, boosted by a surge in oil and gas production. However, growth in the nation’s manufacturing sector surprised on the downside for May as strength in the Pound dampened the demand for export goods. Today’s data has painted a mixed picture of the economy for the second quarter. The Pound has pared yesterday’s gains and is trading well below the 1.56 mark against the US Dollar this morning. Most of the losses today were registered prior to the release of manufacturing and industrial production data. Looking ahead, investors will focus on the NIESR growth estimate for the three months ended June later today, along with the BoE’s interest rate decision and trade data scheduled later this week, to gauge the strength of the nation’s economy.

The Pound-US Dollar currency pair moved above the 1.56 mark yesterday amid the absence of any significant macroeconomic indicators in the UK.

US Dollar – US Markets

The US Dollar is trading higher against the Euro this morning ahead of the publication of trade figures and JOLTS job vacancies later today. The May trade deficit is expected to widen, reflecting a pronounced increase in imports. However, a subsequent rise in exports, led by industrial supplies and capital goods is likely to limit the extent of widening for May. Additionally, investors will eye today’s update on May job opening numbers for further cues on the strength of the US labour market in the second quarter, especially after the May and June payrolls report had showed robust gains in headline numbers. However, the lack of wage growth and the slide in labour market participation have raised concerns amongst currency traders about the timing of an interest rate rise by the US Fed.

Going forward, the minutes of the latest FOMC meeting scheduled tomorrow will draw specific focus on policymakers’ assessment of the inflation and growth outlook, in order to determine the likelihood of a policy change in the coming months.

Euro – European Markets

Data released earlier today showed that German industrial production missed market consensus and recorded a flat reading on a monthly basis for May, as a sharp increase in manufacturing production was offset by a decline in energy and construction output. Post the release of German industrial production data, the Euro has limited its upside against the US Dollar this morning. Additionally, trade balance numbers in France showed that trade deficit widened more than market estimates for May, led by a rise in imports.

Meanwhile, the political and macro uncertainty surrounding Greece continues to dominate headlines in Europe. The Greek Prime Minister Alexis Tsipras is expected to present a new proposal at the emergency Euro zone meeting scheduled later today in a final attempt to save the cash strapped nation from bankruptcy. The outcome of the meeting is expected to prove crucial in deciding the future of Greece in the Euro zone. Meanwhile, the ECB yesterday refrained from raising the cap on the emergency cash support for Greek banks, which are running out of funds.

Other Currencies – Highlights

Earlier today, the RBA opted to leave the cash rate unchanged at 2%, in line with market expectations. However, there was no clarity on the central bank’s future course of action. The RBA Governor Glenn Stevens in the post meeting conference stated that the decision to hold the rate was appropriate for this meeting and informed that the board’s assessment of the outlook would be dependent on economic and financial conditions over the period ahead. The central bank Governor again emphasized the need of further weakening of the Australian Dollar, given the significant decline in key commodity prices. Additionally, he expressed concerns about a speculative property bubble, mainly in Sydney and Melbourne due to low borrowing rates. The Australian Dollar is trading on a weaker footing against the greenback following the RBA’s widely expected move.

With no further domestic macro releases today to trigger volatility in the Australian Dollar–US Dollar currency pair, investors will keep an eye on US economic releases for further direction.