The USD closed marginally lower yesterday after recurring claims for jobless benefits rose to the highest level since the end of 2021. The final reading of Q1 GDP met expectations, while the quarterly reading of the core PCE price index came in just above consensus. The Fed’s Bostic said he expects just one interest rate cut this year, coming in Q4. The Central Bank of Mexico held rates, as expected, and a change to the statement language signaled the country is moving closer to policy easing.

The monthly and yearly PCE price index data released this morning matched estimates. The USD continues to trade lower from overnight highs posted during last night’s presidential debate, down as much as 0.5% from said highs after the 8:30 AM PCE price index data. We will hear from the Fed’s Barkin, Bowman, and Daly today.

EUR/USD rose 0.2% yesterday and is essentially unchanged this morning, having traded lower overnight after Eurozone political risks came into sharper focus. German Finance Minister Christian Lindner said it could be illegal for the ECB to intervene should the French legislative election trigger a selloff in the country’s sovereign bonds. The first round of French elections takes place Sunday, with polling showing the National Assembly, leading in polls, will fall short of the necessary amount of seats for a majority. French CPI data met expectations. Eurozone aggregate CPI data comes Tuesday.

GBP/USD gained 0.15% yesterday and is marginally higher today, trading essentially unchanged from this time last week. GDP data showed the UK exited technical recession at a higher pace than expected. The pair heads for its fourth straight weekly drop as the country heads into its presidential elections next Thursday.

USD/CAD closed flat yesterday and is marginally lower today, trading about 0.15% lower than this time last week. Yesterday, a secondary release of employment figures showed the Canadian economy shed nearly 23,000 jobs in April. The main household survey of employment data for June comes next Friday. April GDP data met forecasts this morning, implying a deceleration in growth from initial readings for the second quarter. The annualized pace of 1.8% growth for Q2 remains above the BOC forecasts of 1.5%.