ForexLive European FX news wrap: Markets look to move on from Iran, Israel tensions

Headlines:

• Crude oil consolidates as supply fears ease
• Israel: We Destoryed One-Third of Iranian Regime’s Missile Launchers
• EU reportedly prepared to accept flat 10% tariffs by US under clear conditions
• India says aiming to sign interim deal with the US before 9 July
• US reportedly pushes Vietnam to reduce reliance on Chinese tech in tariff talks
• How have interest rates expectations changed following the surge in oil prices?
• ECB’s Nagel says not sensible to signal either pause or rate cut for the time being
• ECB’s de Guindos: EUR/USD exchange rate at 1.15 is no big obstacle on inflation target
• Italy May final CPI +1.6% vs +1.7% y/y prelim
• Switzerland May producer and import prices -0.5% vs +0.1% m/m prior
• Eurozone wage costs seen easing in Q1 2025
• China to hold a NPC Standing Committee meeting June 24 to 27

Markets:

• NZD leads, CHF and JPY lag on the day
• European equities higher; S&P 500 futures up 0.6%
• US 10-year yields up 1.8 bps to 4.444%
• Gold down 0.5% to $3,413.62
• WTI crude down 3.4% to $70.45
• Bitcoin up 2.1% to $106,981

As we get into the new week, the fears surrounding the tensions in the Middle East are beginning to ebb. Or at least markets are looking past that and wanting to move on already, especially as concerns surrounding oil supplies are seen easing.

The tensions between Iran and Israel remain high but investors are seeking some cautious optimism in fading the geopolitical situation for now.

Equities are moving higher and the dollar is slightly lower at the balance to start the week.

European indices are seeing modest gains while S&P 500 futures are up 0.6% in trying to start up a bounce back following last week’s decline.

EUR/USD nudged higher from 1.1540 earlier to 1.1575 while AUD/USD is up 0.5% to 0.6520 as buyers seek another attempt to firmly clear the 0.6500 mark. Besides that, there were light changes for USD/JPY, GBP/USD, and USD/CHF with price holding flattish at 144.13, 1.3580, and 0.8111 respectively.

As the market fears ebb, gold is seen down back to $3,413 while oil is falling further as it moves back on approach towards $70.

With market players looking to move on, the focus now slowly shifts back towards upcoming key central bank meetings this week. On the list this week, we’ll have the BOJ, Fed, SNB, and BOE all announcing their respective policy decisions in the coming days.

This article was written by Justin Low at www.forexlive.com.