A bit of calm was seen in the financial markets early Tuesday, before volatility once again picked up around the release of the U.S. ISM services PMI and another round of remarks from Trump.
Although the EU agreed to delay its countermeasures against the US, Trump warned that the region could face much higher tariffs unless they reach a deal soon, bringing global trade jitters back in play.
Here are headlines you may have missed in the last trading sessions!
Headlines:
- New Zealand ANZ Commodity Prices m/m for July: -1.8% (-2.4% previous)
- Australia ANZ Job Advertisements m/m for July: -1.0% (previous reading downgraded from 1.8% to 1.6%)
- China Caixin Services PMI in July: 52.6 (50.4 expected, 50.6 previous)
- European Union will delay its planned retaliatory tariffs against the US as part of a deal reached between President Trump and European Commission President Ursula von der Leyen
- Euro area HCOB Composite PMI Final for July 2025: 50.9 (51.0 forecast; 50.6 previous)
- Germany HCOB Composite PMI Final for July 2025: 50.6 (50.3 forecast; 50.4 previous)
- France HCOB Composite PMI Final for July 2025: 48.6 (49.6 forecast; 49.2 previous)
- Euro area HCOB Services PMI Final for July 2025: 51.0 (51.2 forecast; 50.5 previous)
- France HCOB Services PMI Final for July 2025: 48.5 (49.7 forecast; 49.6 previous)
- Germany HCOB Services PMI Final for July 2025: 50.6 (50.1 forecast; 49.7 previous)
- EU confirmed that 15% tariff will be all-inclusive, applied also to cars and car parts, but that framework for a trade deal will not be legally binding
- EU trade chief Sefcovic warned about some ‘turbulence’ in US trade talks moving forward
- U.K. New Car Sales YoY for July 2025: -5.0% (6.0% forecast; 6.7% previous)
- U.K. S&P Global Composite PMI Final for July 2025: 51.5 (51.0 forecast; 52.0 previous)
- U.K. S&P Global Services PMI Final for July 2025: 51.8 (51.2 forecast; 52.8 previous)
- Euro area PPI YoY for June 2025: 0.6% (0.4% forecast; 0.3% previous); Euro area PPI MoM for June 2025: 0.8% (0.7% forecast; -0.6% previous)
- Canada Balance of Trade for June 2025: -5.86B (-5.6B forecast; -5.9B previous)
- Canada Exports for June 2025: 61.74B (61.0B forecast; 60.81B previous)
- Canada Imports for June 2025: 67.6B (66.6B forecast; 66.66B previous)
-
U.S. Balance of Trade for June 2025: -60.2B (-61.4B forecast; -71.5B previous)
- U.S. Imports for June 2025: 337.5B (338.6B forecast; 350.5B previous)
- U.S. Exports for June 2025: 277.3B (277.2B forecast; 279.0B previous)
- U.S. S&P Global Services PMI Final for July 2025: 55.7 (55.2 forecast; 52.9 previous)
-
U.S. ISM Services PMI for July 2025: 50.1 (51.0 forecast; 50.8 previous)
- U.S. ISM Services Prices for July 2025: 69.9 (67.7 forecast; 67.5 previous)
- U.S. ISM Services Employment for July 2025: 46.4 (48.0 forecast; 47.2 previous)
- U.S. RCM/TIPP Economic Optimism Index for August 2025: 50.9 (49.0 forecast; 48.6 previous)
- Trump criticized Fed head Powell for being “highly political” and touted other potential candidates as next Fed head
- Trump also warned that EU would face higher tariffs unless it invested, added that tariffs on chips would be announced soon
- New Zealand Global Dairy Trade Price Index for August 5, 2025: 0.7% (0.9% forecast; 1.1% previous)
- U.S. API Crude Oil Stock Change for August 1, 2025: -4.2M (1.54M previous)
- New Zealand Employment Change QoQ for June 30, 2025: -0.1% (-0.1% forecast; 0.1% previous)
- New Zealand Labour Costs Index YoY for June 30, 2025: 2.2% (2.0% forecast; 2.5% previous)
Broad Market Price Action:
Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView
Markets moved mostly sideways during Tuesday’s Asian trading session, shrugging off a stronger than expected Caixin services PMI reading from China as investors likely braced for a fresh round of top-tier catalysts.
Crude oil broke below its range as European markets opened, possibly reflecting additional bearish pressure on global trade uncertainty and the OPEC+ commitment to boost output in September. The energy commodity extended its slump after President Trump warned that the EU could still face higher tariffs and that higher trade levies on chips would be announced soon.
U.S. equity indices also turned lower on the prospect of higher tariffs on pharma and chip imports, chalking up additional declines after the ISM services PMI fell short of estimates. The Dow closed 0.14% lower while the S&P 500 index slid 0.49%.
Treasury yields and the dollar also dipped after Trump’s testimony, as he also criticized Fed head Powell for being “highly political” and suggested additional candidates to replace him as Chairperson.
Gold prices, which had been edging lower on slightly improved market sentiment when the EU agreed to delay its countermeasures on the US, banked on safe-haven flows during Trump’s speech plus the weak ISM services PMI, closing 0.22% higher by session’s end.
FX Market Behavior: U.S. Dollar vs. Majors:
Overlay of USD vs. Majors Chart by TradingView
The Greenback was off to a bearish start during the first few hours of the Asian trading session, perhaps picking up from the previous session’s momentum, before rebounding as risk-off flows appeared to come in play.
Traders seemed to shrug off the upbeat Chinese services PMI, as NZD and AUD were on the back foot for the remainder of the session, possibly weighed down by a decline in New Zealand’s ANZ commodity prices and Australia’s ANZ job advertisements figure.
The dollar extended its climb as European markets opened, with the euro having its share off losses after the region’s PPI fell short of estimates. GBP managed to hold its ground, however, as the U.K. appeared relatively immune to trade jitters surrounding EU-US talks, as highlighted by stronger car sales data and an upbeat U.K. services PMI.
Trump’s remarks forced USD to return some of its earlier gains, though, as he once again criticized Fed head Powell’s policy decisions while also stoking global trade tensions by warning about higher EU tariffs and additional trade levies on pharma and chip imports.
The dollar saw an even steeper drop after the U.S. ISM services PMI fell short of estimates, falling from 50.8 to 50.1 instead improving to the 51.5 consensus, reflecting how tariffs uncertainty has dampened new orders and sentiment.
Still, USD managed to hold on to gains versus the much weaker JPY on softer BOJ tightening expectations. NZD also failed to take advantage of dollar weakness since Kiwi traders were likely bracing for the quarterly New Zealand jobs report, which came in net positive.
Upcoming Potential Catalysts on the Economic Calendar
- Germany HCOB Construction PMI at 7:30 am GMT
- U.K. S&P Global Construction PMI at 8:30 am GMT
- Euro area Retail Sales at 9:00 am GMT
- U.S. MBA Mortgage Applications at 11:00 am GMT
- Canada S&P Global Services PMI at 1:30 pm GMT
- Canada S&P Global Composite PMI at 1:30 pm GMT
- U.S. EIA Crude Oil Stocks Change at 2:30 pm GMT
- Fed official Cook’s Speech at 6:00 pm GMT
- Fed official Collin’s Speech at 6:00 pm GMT
- Fed official Daly’s Speech at 8:10 pm GMT
The coast is clear in terms of top-tier economic releases today, but still keep an eye out for eurozone retail sales data and the EIA crude oil inventory report that could make some waves among EUR pairs and commodity prices.
We’re also getting another round of commentary from Fed officials (Cook, Collins, and Daly) during the New York session, possibly contributing to dollar volatility.
As always, look out for global trade developments and geopolitical headlines that could influence overall market sentiment. Stay nimble and don’t forget to check out our Forex Correlation Calculator when taking any trades!
