Author: admin

There was several significant news announcements likely have an influence on monetary policy.
There was also drama between President Donald Trump and Fed Chair Jerome Powell that weighed on the markets this week. Powell has drawn Trump’s ire for failing to cut interest rates, which the president believes should be at least 300 basis points lower than they are today. Trump later came out and said that Powell would likely be replaced in eight months when his term is up.

On Tuesday, it was revealed that inflation had jumped to 2.7 percent on an annualized basis in June. This was higher than the projected 2.6 percent and higher than last month’s 2.4 percent.

It was also revealed that overall inflation was up 0.3 percent in the past month while core inflation was up 0.2 percent. Analysts had predicted that both would increase by .3 percent this month. Economists believe that inflation could continue to go higher as tariffs imposed on most nations begin on the first day of August.

Still, economic data remains strong. On Wednesday, the Price Producers Index (PPI) was released and revealed that prices were flat on a monthly basis. The same was true for the Core PPI, and it was believed that both core and overall PPI would increase by 0.2 percent in June. It’s worth noting that core PPI for May was revised upward to 0.4 percent while overall PPI was revised upward to 0.3 percent in May.

Thursday saw the release of retail and core retail sales figures for June. During that time, retail sales overall went up by 0.6 percent while core retail sales were up by .5 percent. Retail sales were only expected to increase by 0.1 percent while core retail sales were only expected to rise by 0.3 percent in June.

Also on Thursday, unemployment claims for the week were made public. Over the past seven days, there were 221,000 requests for benefits, below the expected 233,000.

On Friday, the University of Michigan released its consumer sentiment and inflation expectation reports. Consumer sentiment rose to 61.8 compared to 60.7 last month. Respondents believe that inflation will be at 4.4 percent a year from now, which was lower than last month when respondents said that inflation would be at 5 percent a year from now.

The S&P 500 finished up 57 points this week to finish at 6,296, which is just off the all-time high set on Friday morning. On Wednesday, the market made its low of the week when it dipped to 6,224.

The Dow was off by just 1.84 points this week to close at 44,342. On Wednesday morning, the index made a low of 43,912 before reversing and hitting a high of 44,536 on Thursday.

Finally, the Nasdaq finished the week up 394 points to close at 20,895. The market began the week at its lowest point, which was 20,499 and made its high of the week Friday morning when it hit 20,971.

In international news, Canada announced on Tuesday that its median CPI in June was 3.1 percent on an annualized basis. Furthermore, inflation was .1 percent on a monthly basis over the same period. Great Britain announced on Wednesday that its inflation rate was 3.6 percent on an annualized basis in June. Finally, Australia announced Wednesday evening that its economy added 2,000 jobs in June and that the country’s unemployment rate increased to 4.3 percent.

American traders will notice that the upcoming week is light on the news. The only major scheduled announcements are the Flash Manufacturing and Flash Services PMIs slated to come out Thursday. However, there will be big news coming out of Europe as the European Central Bank makes an interest rate decision on Thursday morning.

Tariffs once again took center stage last week. Several countries received tariff letters from Washington outlining their new payment obligations moving forward. Canada was hit with a 35 percent tariff while South Africa was hit with a 30 percent tariff. Donald Trump has said that tariffs will go into effect on the first day of August, but it’s possible that further delays could occur.

Fiscal policy was another key story as the Fed released the minutes of its June meeting. It revealed a consensus that interest rates should be lowered in the future, but there is a divide when it comes to timing and scope. While some believe that the time is now to start doing so, others believe that it’s best to see what happens with the impact of tariffs over the coming months.

Inflation data for June will be released week, and it’s expected that prices increased by .3 percent over the past month. The annual inflation rate is expected to have ticked up from 2.4 percent to 2.6 percent in June. It’s likely that the final figure is going to weigh heavily on the Fed’s rate decision.

In addition to the release of the FOMC meeting minutes, unemployment claim data was made public on Thursday. That morning, it was revealed that 227,000 people sought benefits over the past seven days. Analysts had projected that 236,000 requests had been made. Last week, 232,000 new claims were made across the country.

The S&P 500 was relatively flat this week, closing up 1.65 points to finish at 6,259. This was a .03 percent increase for a market that is up 6.43 percent year-to-date. On Monday afternoon, the market made its weekly low dipping to 6,208 before reversing and largely gaining ground. On Thursday afternoon, the market reached its weekly high of 6,289.

Like the S&P 500, the Dow was also relatively flat for the week finishing down .87 percent to close at 44,371. Despite the weekly loss, the index is still up more than 4 percent for the year. The Dow followed the same pattern as the S&P this week making its low of the week on Monday afternoon and its weekly high on Thursday. For the last five days, the index ranged from 44,173 to 44,761.

Finally, the Nasdaq was also flat for the week having closed at 20,585 on Friday. This represented a gain of .52 percent for the last five trading days for the index that is up 6.6 percent through the first six months of 2025. On Monday afternoon, the market made a low of 20,333 before reversing and engaging in sideways movement through Friday.

In international news, Australia decided to keep its interest rate steady at 3.85 percent despite a cut being priced in before the news. The Royal Bank of Australia (RBA) said that it needed more time and guidance regarding inflation before making any additional cuts. New Zealand also held its key rate steady at 3.25 percent on Tuesday night. On Friday, Canada announced that its economy added 83,000 new jobs and that its unemployment rate dipped to 6.9 percent.

In the United States, the Price Producers Index (PPI) comes out on Wednesday while retail sales and unemployment figures will be released on Thursday. Great Britain and Canada are also expected to release inflation numbers this week.

The first few days of July were interesting as the nonfarm payroll reports for June were released. There were some mixed messages in the data that caused some to question the path forward as it relates to monetary policy.

For the month of June, there were 7.77 million available jobs in the United States compared to an expected 7.32 million. This was the highest number of open positions since January when more than eight million jobs were available.

In addition, the ISM Manufacturing PMI came out on Tuesday, and it came in at 49, which was roughly in line with expectations. The report suggests that manufacturing is in a slight contraction period right now. However, the June number was higher than last month’s reading of 48.5.

On Wednesday the ADP nonfarm payroll reported the economy shed 33,000 jobs in June. Analysts had expected a gain of 99,000 jobs. It should also be noted that May’s final number was revised downward to 29,000.

However, on Thursday the Bureau of Labor Statistics (BLS) releasing its version of the nonfarm payroll report. It found that the economy added 147,000 jobs compared to an expected 111,000 prior to the release. It was noted that only 74,000 of those jobs came from the private sector while the rest were mostly related to gains made in state governments.

Unemployment claims figures for the past seven days were also released Thursday. It was revealed that 233,000 people requested benefits during the reporting period, less than the estimated 240,000 claims prior to the report’s release.

Finally, the ISM Services PMI came out late Thursday morning with a figure of 50.8, matching expectations. This means that services are still in a period of relative expansion, and the June figure represents a rebound from the somewhat shocking 49.9 reported for May.

Early this week, Jerome Powell made scheduled comments that were interpreted by some as relatively dovish. He said that July may represent an appropriate time to cut rates, but cuts would already have been underway if it weren’t for Trump’s proposed tariffs. The 90-day pause on tariffs imposed in April are set to expire on July 9.

Over the past five trading days, the S&P 500 finished up about 2 percent to close at 6,279. This is a new high for the year as well as a new all-time high for the index. On Monday afternoon, the market put in the low of the week of 6,182 before beginning a slow climb throughout the rest of the week. It would then close near the high of the week when trading halted on Thursday afternoon.

The Dow followed a similar trajectory as the S&P 500, closing up almost 3 percent over the last five trading days. It closed the week at 44,828, which is also a yearly and all-time high. For the week, the market made a low of 43,945 on Monday afternoon and closed near the high.

The Nasdaq would also finish the week significantly higher. However, unlike the other two indexes, it made its weekly low on Tuesday when it dipped to 20,113 early that morning. It would then reverse and close the week at 20,601, which is a yearly and all-time high.

The FOMC meeting minutes from the June meeting are expected to be released on Wednesday. In addition, unemployment claim data is set to be made public on Thursday. International traders may want to keep an eye on rate announcements from Australia and New Zealand.