In focus today
In the US, the April JOLTS report is due for release in the afternoon. The Fed follows the number of job openings as a key measure of labour demand. Back in March, the number of hires also showed tentative signs of a recovery. Moreover, the Fed’s Beth Hammack (voter, hawk) will be on the wires.
In the euro area, today brings the aggregate HICP inflation for May. We have already received 75% of the index from individual country releases, which came in slightly lower than expected. Importantly, the country releases did not indicate that rising prices from the energy shock was broadening beyond energy components. We expect headline inflation at 3.1% y/y and core at 2.4% y/y.
In Denmark, Danmarks Nationalbank’s press release on the May FX reserve will be published, providing insight into whether the central bank intervened in the FX market during May, where EUR/DKK hit a historic high level of 7.4741.
In Poland, the National Bank of Poland will announce its rate decision. We expect the policy rate to be kept unchanged at 3.75%, in line with consensus.
Economic and market news
What happened since yesterday
In the Oil market, Brent crude reversed much of last week’s ceasefire-driven decline, briefly trading above USD 97/bbl, after Iran reportedly halted negotiations with the US over continued fighting in Lebanon. Prices later eased after President Trump said negotiations with Tehran were continuing and signalled expectations of a deal to extend the ceasefire and reopen Hormuz “over the next week”. Trump also claimed Israel and Hezbollah had agreed to stop shooting, helping Brent slip back below USD 95/bbl.
In the US, ISM Manufacturing surprised on the upside in May and signals a more positive outlook for the economy than the PMI. The headline index rose to 54.0 (cons: 53.0, prior: 52.7), driven by strong new orders at 56.8 (prior: 54.1) and higher employment. The prices index edged marginally lower but remains historically elevated. The details suggest solid demand across both domestic and export orders, while an improved order‑inventory balance often points to further gains in production.
In the euro area, inflation expectations in the ECB’s consumer survey stabilised in April following the large uptick in March. The 3Y median expectation ticked down to 2.9% from 3.0%, while the 1Y median remained unchanged at 4.0%. Although the still elevated expectations support the ECB’s hike in June, the stabilisation buys the ECB more time to assess the impact of the shock before embarking on a second hike.
Also in the euro area, the unemployment rate remained at 6.3% in April similar to March. It was above the expected 6.2%, but the historical data was revised up while the actual number of unemployed persons fell from March to April. Hence, the rise in the unemployment rate should not be seen as a sign of new weakening in the labour market from the war in Iran.
In OPEC+, several member countries are reportedly leaning towards a modest 188,000 bpd increase in their July oil output target at Sunday’s meeting, mirroring the June hike excluding the UAE. However, with production still well below target due to export cuts and the SOH closure, the move is unlikely to affect oil prices unless it results in higher realised exports.
In Denmark, Social Democrat leader Mette Frederiksen has agreed to form a new centre-left minority coalition government, securing a third consecutive term as prime minister after the March election. The government will be presented this week and will include the Social Democrats, Social Liberals, Left Greens and Moderates.
Equities: Global equities rose yesterday and several indices set new all-time highs, but the move was extremely narrow. Leadership came almost entirely from energy and, needless to say, tech. The narrow leadership was certainly not something one could blame on the macro data. Rather, renewed tensions around Iran and a 5 percent jump in oil prices was the reason that 9 out of 11 sectors were lower yesterday. However, given the strong performance in tech, large cap cyclicals outperformed while minimum volatility and defensives underperformed.
It has become even more evident recently just how narrow equity market leadership has become. Since the end of March, global equities are up around 17 percent, but this has been driven especially by the tech sector, which globally is up close to 45 percent since the bottom. This reinforces what we have stressed many times this year, and what is becoming increasingly clear for investors across financial markets: 2026 will be a year dominated by AI and the AI buildout. We are seeing earnings growth that is four times what GDP growth would normally imply! From an equity and risk perspective, that means the 2026 story is AI to a much greater extent than oil, Iran, geopolitics and so on. It is more or less all about AI.
This morning, Asian markets are somewhat in the red, led by South Korea, which is down a couple of percent. But note that South Korea’s leading equity index is still up around 130 percent year to date. If there was any doubt about what that rhymes with, the answer is of course AI. European futures are marginally higher, while US futures are in the red this morning.
FI and FX: A rebound in the oil price set the tone in FX and fixed income markets yesterday. The rise in the oil price pushed up yields in US and Europe in parallel with 2Y EUR and USD swap rates rising as much as 6bp. EUR/USD fell and USD/JPY rose owing mainly to the rise in oil prices. EUR/SEK also rose and EUR/NOK initially traded back and forth on the news but is also trading at a higher level now.
Editorial note: This recovered market brief has been cleaned and reclassified by Next Move Markets for educational market intelligence. It is not investment advice.
Next Move Markets desk view
For active traders, this brief should be read through the lens of currency markets rather than as a standalone headline. The key question is whether the theme behind Euro Area Inflation to Affirm June ECB Hike can influence positioning beyond the first reaction. That means watching central-bank expectations, yield differentials, dollar momentum and risk appetite together, not in isolation.
A richer trading read comes from separating the catalyst from confirmation. The catalyst explains why markets are paying attention; confirmation comes from price action, liquidity and cross-asset behavior after the headline is digested. If those signals do not align, traders should treat the move as fragile and keep risk tighter.
What traders should watch next
- Whether the move is confirmed by the U.S. dollar index and short-term rate expectations.
- How London and New York liquidity react once the initial headline risk is absorbed.
- Whether price action respects the latest support and resistance zones instead of fading immediately.
- Any follow-up comments from central-bank officials or data releases that change the rate path.
Risk context
This article is a market-intelligence brief, not a trade recommendation. Before acting on the theme, traders should define invalidation, position size and the time horizon of the setup. The same headline can support a short-term reaction and still fail as a multi-session trend if liquidity, policy expectations or broader sentiment move the other way.
Scenario map
The base case is that traders keep this theme on the radar while waiting for confirmation from central-bank expectations, yield differentials, dollar momentum and risk appetite. A stronger continuation scenario requires follow-through after the first reaction, preferably with related assets moving in the same direction. A failure scenario develops if the headline is quickly absorbed, volatility fades and price returns inside the previous range.
For currency markets, the most useful approach is to compare the article theme with live market behavior. If the market confirms the narrative, pullbacks can become more constructive. If the market rejects it, the headline becomes background noise rather than a trading driver.
Execution discipline
- Define the level first: traders should know where the idea is invalidated before thinking about upside or downside.
- Separate news from setup: Euro Area Inflation to Affirm June ECB Hike may explain attention, but entry quality still depends on timing, liquidity and risk/reward.
- Watch confirmation: a clean move usually appears across related markets, not only in one isolated instrument.
- Control exposure: if volatility expands, smaller position sizing can be more professional than chasing the headline.
Next Move Markets treats this kind of brief as a starting point for preparation: identify the driver, map the scenarios, then wait for the market to prove which path is actually being priced.
