USD

The US Dollar is bouncing off the day's lows and inching toward positive territory as markets react to the slate of US jobs data released this morning.

June's ADP employment data showed the US private sector added a surprisingly strong 497,000 jobs, led by significant gains in the services sector. June's surge in job creation was the most in over a year and well above the expected addition of 228,000 jobs. Meanwhile, wage growth slowed for both job changers and job stayers.

In addition, initial jobless claims in the US increased to 248,000, exceeding market expectations of 245,000. However, continuing claims decreased by 13,000 to reach 1.72 million, painting a mixed picture of the labor market.

Later today, June's ISM Services PMI is set for release, with markets anticipating a slight uptick to 51 after coming in at 50.3 in May.

EUR

The Euro is clinging to modest gains this morning after a wave of US and European data releases earlier today.

The Eurozone's May Retail Sales Data, today's headline release in Europe, showed a second consecutive month of stagnation, falling short of the anticipated 0.2% increase. This was attributed to households coping with decreased income due to high inflation and increasing interest rates, resulting in an overall contraction of 2.9% in retail sales compared to the previous year.

On a positive note, Germany's factory orders in May surged by 6.4% compared to April, blowing past market expectations of a 1.2% rise. A spike in large-scale orders for motor vehicles and transport equipment predominantly drove the increase.

GBP

The Pound is in the green heading into the US session following the release of a BoE survey that showed UK companies' expectations for selling price inflation cooled, including a decline in output price inflation expectations for the coming year to 5.3%, the lowest level in over a year.

Meanwhile, house building in the UK experienced a notable plunge, marking its most substantial decline in over 14 years, except for the initial pandemic months. Elevated interest rates spurred this downturn, resulting in heightened borrowing costs and falling demand. The impact of this downturn was reflected in the S&P Global/CIPS Construction PMI, which plummeted to a five-month low of 48.9, falling short of economists' expectations of 50.

JPY

The Japanese Yen is in positive territory today after hitting a one-week high earlier this morning as traders began to take the market intervention threat from Japanese officials more seriously.

On the data front, JPY traders will look towards several fresh releases overnight, including May's Labor Cash Earnings figure, a measure of average pre-tax income for regular employees. Markets expect a rise of 0.7% in May, lower than the 1% increase seen in April. A few hours later, traders will get a look at May's Coincident and Leading Economic Indices to get an updated pulse on the Japanese economy.

CAD

After dropping over 0.4% against the Greenback yesterday, the Loonie is down another 0.3% this morning as USD/CAD traders digest this morning's jobs data out of the US and the Fed's hawkish tone seen in the most recent FOMC minutes.

Meanwhile, Canadian trade data was also released this morning. Canada recorded its most significant trade deficit since October 2020, amounting to CAD 3.44 billion. This was attributed to a 3.8% decline in exports, particularly in energy and agricultural products, while imports increased by 3%, primarily driven by increased purchases of metal and vehicle-related items.

Tomorrow is set to be an eventful day for CAD traders, with Canadian unemployment and Ivey PMI numbers on deck as well as US Non-Farm Payrolls.

MXN

The Mexican Peso is down around 0.5% on the day after gaining ground on the Dollar in each of the past four days. Today's drop comes as traders analyze US jobs data and Mexico's latest consumer confidence release.

In June, consumer confidence in Mexico continued to improve, reaching a high not seen in over 18 months at 45.2. Despite slightly worse personal situation expectations and prospects for the domestic economy due to anticipated inflation, households indicated they were less pessimistic about their financial situation, savings, and major purchases.

Looking ahead, Mexico's June inflation data is set for release tomorrow at 7:00 AM EST, 90 minutes before the highly anticipated US Non-Farm Payrolls release.

BRL

The Brazilian Real is reeling this morning, down around 0.8%, as it looks to be on pace for a four-day losing streak against the Greenback.

Yesterday's release of June's S&P Global Brazil Composite PMI showed a slight decrease to 51.5 but still indicated stable private-sector expansion for the fourth month in a row. The services sector showed resilience, driving growth with a PMI of 53.3. In contrast, the manufacturing sector continued to face challenges with a PMI of 46.6, contracting for the eighth consecutive month. Despite these variations, aggregate sales remained strong, and both sectors expressed optimism for the future, encouraged by anticipated interest rate cuts from the Brazilian Central Bank later this year.

CNY

The Yuan is trading sideways this morning in the aftermath of US jobs data, looking to find some momentum after the PBoC's latest assurance to markets that it will take necessary action to prevent excessive Yuan depreciation.

The PBoC-backed Financial News publication emphasized the ability of officials to mitigate market panic and maintain smooth operations in the FX market. Subsequently, the Bank set a midpoint fixing that exceeded expectations for the fourth consecutive day to keep the Yuan from further declines.

Meanwhile, US Treasury Secretary Janet Yellen has arrived in Beijing for a four-day visit to improve US-China relations. Yellen plans to discuss concerns about China's recent actions against US firms and trade barrier issues, although hope for a breakthrough is low on both sides.