SocGen's Comment on Currencies After U.S. Strike on Iran

The US dollar rose against its major trading partners early Monday, with testimony by Federal Reserve Chairman Jerome Powell, home sales data, the final estimate of Q1 gross domestic product and personal income, sales and price data for May the focus for this week after the military action taken by the US against Iranian nuclear facilities Saturday.

On Monday, S&P Global flash manufacturing and services data for June are due to be released at 9:45 am ET, followed by existing home sales data for May and an appearance by Fed Vice Chair for Supervision Michelle Bowman, both at 10:00 am ET.

Chicago Fed President Austan Goolsbee is scheduled to speak at 1:10 pm ET, followed by Federal Reserve Governor Adriana Kugler and New York Fed Governor John Williams at a Fed Listens event at 2:30 pm ET.

Tuesday's highlights include the first day of Powell's testimony, current account data for Q1, nonmanufacturing data for June from the Philadelphia Federal Reserve bank, conditions data from the Richmond Fed and consumer confidence data for June.

Powell's second day of testimony, new home sales data for May and weekly mortgage applications and oil stocks inventory data are due Wednesday.

GDP data for Q1, weekly jobless claims, durable goods orders, advance trade data and pending home sales data for May are the highlights Thursday.

Personal income, spending and price data for May and the final University of Michigan consumer sentiment reading for June are due to be released Friday.

A quick summary of foreign exchange activity heading into Monday:

fell to 1.1470 from 1.1520 at the Friday US close and 1.1515 at the same time Friday morning. The Eurozone manufacturing purchasing managers' index held steady just below the breakeven point in June while services PMI indicated no change activity in the sector, according to preliminary data released earlier Monday. European Central Bank President Christine Lagarde is due to speak at 9:00 am ET. The next European Central Bank meeting is scheduled for July 24.

fell to 1.3378 from 1.3449 at the Friday US close and 1.3491 at the same time Friday morning. UK manufacturing PMI rose in June, but still indicated contraction, while services PMI indicated faster expansion, according to preliminary data released earlier Monday. The next Bank of England meeting is scheduled for Aug. 7.

rose to 147.8561 from 146.1292 at the Friday US close and 145.6061 at the same time Friday morning. Japanese manufacturing PMI rose back above the breakeven point in June while services PMI moved further into expansionary territory in the month, preliminary data released overnight showed. The next Bank of Japan meeting is scheduled for July 30-31.

rose to 1.3790 from 1.3740 at the Friday US close and 1.3710 at the same time Friday morning. There are no Canadian data on Monday's schedule. The next Bank of Canada meeting is scheduled for July 30.

The US dollar was mixed against its major trading partners early Friday — up versus the yen and Canadian dollar, down versus the euro and pound — following Thursday's holiday.

The Philadelphia Federal Reserve's manufacturing reading for June is due to be released at 8:30 am ET, followed by leading indicators data at 10:00 am ET.

The St. Louis Fed is due to update its gross domestic product Nowcast estimate for Q2 around midday.

A quick summary of foreign exchange activity heading into Friday:

rose to 1.1520 from 1.1499 at the Thursday close and 1.1474 at the same time Thursday morning. Eurozone consumer confidence data for June are due to be released at 10:00 am ET. The next European Central Bank meeting is scheduled for July 24.

rose to 1.3496 from 1.3469 at the Thursday close and 1.3413 at the same time Thursday morning. UK retail sales declined more than expected in May, pulling down the year-over-year rate, according to data released overnight. The next Bank of England meeting is scheduled for Aug. 7.

rose to 145.4678 from 145.4154 at the Thursday close but was below a level of 145.7441 at the same time Thursday morning. Japanese consumer price growth slowed on a year-over-year basis in May, but the core rate accelerated according to data released overnight. Bank of Japan Governor Kazuo Ueda said overnight the BoJ will continue to lift its target rate as long as economic improvements lift inflation, according to Reuters. The next Bank of Japan meeting is scheduled for July 30-31.

rose to 1.3703 from 1.3698 at the Thursday close but was below a level of 1.3711 at the same time Thursday morning. Canadian retail sales data for April and industrial product, raw materials and new home prices for May are all due to be released at 8:30 am ET. The next Bank of Canada meeting is scheduled for July 30.

The US dollar fell against its major trading partners early Wednesday, except for a gain versus the Canadian dollar, ahead of a busy morning of data releases and the Federal Open Market Committee's statement at the conclusion of its two-day interest rate policy setting meeting in the afternoon.

Housing starts data for April and weekly jobless claims data, released a day early due to the US Juneteenth holiday Thursday, are due to be published at 8:30 am ET.

Weekly petroleum stocks inventory data are set to be released at 10:30 am ET and weekly natural gas stocks data are due at 12:00 pm ET. The Atlanta Fed is expected to update its gross domestic product nowcast estimate for Q2 around midday.

The FOMC's statement is scheduled to be released at 2:00 pm ET, followed by Fed Chairman Jerome Powell's press conference at 2:30 pm ET. There is a 99.9% chance of no change in rates being priced in according to the CME's FedWatch Tool.

Earlier Wednesday, the Mortgage Bankers Association said mortgage applications declined in the week ended June 13 despite lower mortgage rates due to continued uncertainty.

A quick summary of foreign exchange activity heading into Wednesday:

rose to 1.1497 from 1.1485 at the Tuesday US close but was below a reading of 1.1568 at the same time Tuesday morning. Eurozone consumer prices were flat in May, slowing the year-over-year pace, while the current account surplus narrowed in the same month, according to data released earlier Wednesday. European Central Bank policy board member Philip Lane is due to speak at 11:00 am ET, followed by ECB Vice President Luis de Guindos at 2:00 pm ET. The next European Central Bank meeting is scheduled for July 24.

rose to 1.3449 from 1.3428 at the Tuesday US close but was well below a level of 1.3566 at the same time Tuesday morning. UK consumer prices rose as expected in May, but the year-over-year rate slowed from the previous month, data released earlier Wednesday showed. The next Bank of England meeting is scheduled for Thursday when no change in interest rates is expected.

fell to 144.8620 from 145.2280 at the Tuesday US close but above a level of 144.6459 at the same time Tuesday morning. The Japanese trade deficit widened significantly in May compared with a month earlier while Japanese business conditions remained positive in June, according to data released overnight. The next Bank of Japan meeting is scheduled for July 30-31.

rose to 1.3665 from 1.3646 at the Tuesday US close and 1.3559 at the same time Tuesday morning. There are no Canadian data on Wednesday's schedule, but Bank of Canada Governor Tiff Macklem is due to speak at 11:15 am ET. The next Bank of Canada meeting is scheduled for July 30.

The US dollar fell against its major trading partners early Tuesday, except for a gain versus the pound, ahead of a busy economic release day, starting with retail sales and import and export price data for May and the New York Federal Reserve's services reading for June, all at 8:30 am ET.

Weekly Redbook same-store sales data are due to be released at 8:55 am ET, followed by industrial production data for May at 9:15 am ET, business inventories data for April and the National Association of Home Builders' builder sentiment reading for June at 10:00 am ET.

The Atlanta Fed's gross domestic product Nowcast estimate for Q2 is expected to be updated around midday.

A quick summary of foreign exchange activity heading into Tuesday:

rose to 1.1572 from 1.1555 at the Monday US close but was below a level of 1.1578 at the same time Monday morning. Eurozone economic sentiment rose more than expected in June, according to data released earlier Tuesday. The next European Central Bank meeting is scheduled for July 24.

fell to 1.3571 from 1.3575 at the Monday US close and 1.3584 at the same time Monday morning. There are no UK data on Tuesday's schedule. The next Bank of England meeting is scheduled for Thursday when no change in interest rates is expected.

fell to 144.5786 from 144.8605 at the Monday US close but was above a level of 144.0351 at the same time Monday morning. The Bank of Japan decided to leave its policy rate unchanged in its post-meeting statement released Monday evening US time, as expected, but said it intends to slow its pace of bond buying to allow rates to rise. The next Bank of Japan meeting is scheduled for July 30-31. There were no Japanese data released overnight.

fell to 1.3562 from 1.3579 at the Monday US close and 1.3571 at the same time Monday morning. Canadian foreign securities purchases data for April are due to be released at 8:30 am ET. The next Bank of Canada meeting is scheduled for July 30.

The US dollar fell against its major trading partners early Monday as the focus turns to May retail sales data Tuesday and the Federal Open Market Committee's policy statement at the conclusion of its two-day meeting Wednesday, when there is a 99.8% chance of no change in the current 4.25% to 4.50% federal funds rate range being priced into the CME's Fed Watch tool.

Monday's schedule is light, with only the New York Fed's Empire State reading for June at 8:30 am ET.

Tuesday's highlights include retail sales, import and export prices and industrial production, all for May.

Prior to the FOMC's meeting announcement Wednesday, data on home building, weekly jobless claims and oil stocks inventories are due to be released.

After Thursday's US Juneteenth holiday, leading indicators data for May are due to be released Friday.

A quick summary of foreign exchange activity heading into Monday:

rose to 1.1575 from 1.1544 at the Friday US close and 1.1496 at the same time Friday morning. Eurozone wage growth slowed in Q1 according to data released earlier Monday. The next European Central Bank meeting is scheduled for July 24.

rose to 1.3579 from 1.3564 at the Friday US close and 1.3527 at the same time Friday morning. There are no UK data on Monday's schedule. The next Bank of England meeting is scheduled for Thursday when no change in interest rates is expected.

fell to 144.0021 from 144.0342 at the Friday US close and 144.3661 at the same time Friday morning. There were no Japanese data released overnight. The Bank of Japan is expected to hold its policy rate steady in its policy statement due to be released at 10:30 pm ET Monday evening.

fell to 1.3573 from 1.3588 at the Friday US close and 1.3645 at the same time Friday morning. Canadian housing starts for May are due to be released at 8:15 am ET. The next Bank of Canada meeting is scheduled for July 30.

The yen weakens against other G-10 and Asian currencies in the early session amid rising crude oil prices. "Higher oil prices are a positive for USD/JPY because the U.S. is a net energy exporter while Japan is a net energy importer," CBA's Global Economic & Markets Research team says in a note. Focus may also be on the BOJ and FOMC monetary-policy meetings this week. These meetings could inject volatility in AUD/JPY, CBA's team adds. USD/JPY is up 0.3% to 144.42, AUD/JPY edges 0.2% higher to 93.80, and EUR/JPY rises 0.1% to 166.70, FactSet data show. (ronnie.harui@wsj.com)