Quick overview
- The UK is set to release its June GDP data, with expectations for a modest rebound despite concerns over fiscal challenges.
- Political tensions surrounding the Federal Reserve intensified after accusations of mortgage fraud against Fed Governor Lisa Cook.
- FOMC minutes revealed a dominant concern over inflation risks, leading to a hawkish tone that rattled equity markets.
- Walmart and Intuit are among major companies reporting earnings today, with investors keenly watching for insights into consumer spending and fintech growth.
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Today we have the UK June GDP data and company earnings, with Walmart to release the numbers ahead of the US market open.
Political Pressure on the Fed
The day began with controversy after Bill Pulte, Director of the Federal Housing and Financing Association, posted a tweet accusing Fed Governor Lisa Cook of “potentially” engaging in mortgage fraud on two homes she purchased. The post added fuel to an already tense atmosphere ahead of the release of the Federal Open Market Committee (FOMC) meeting minutes.
FOMC Minutes: Inflation Risks Dominate
When the minutes were published later in the evening, they revealed that most participants believed upside risks to inflation remained more pressing than risks to employment. While the Committee acknowledged both sides of its dual mandate, the prevailing view was that price pressures continued to pose the greater threat.
A few members, however, judged that the risks were balanced, and some highlighted downside risks to employment as potentially more significant. Still, the dominant concern was inflation, underscoring the hawkish tone of the minutes.
Critics argue that the Fed’s policy of maintaining high interest rates over the past two years has failed to tackle inflation effectively. Instead, it made borrowing more expensive for households and businesses, while multinational corporations continued to raise prices. This has fueled a counterview that lower rates might have helped tame inflation more effectively in the current environment.
Stock Market Reaction
The hawkish tone initially rattled equity markets, with the Nasdaq dropping more than 400 points at session lows before partially recovering later in the day. Broader markets also traded lower, reflecting investor unease.
Key Market Events for Today
UK GDP Preview
The UK will publish its June GDP figures on Thursday, with expectations for a modest rebound. Monthly growth is forecast to rise to 0.1% from May’s -0.1% decline, though the quarterly rate is set to slow sharply to 0.1% from 0.7%. The weak momentum follows a strong Q1 that had been inflated by tariff-related front-loading.
Analysts at Investec are more optimistic, projecting a +0.3% gain, pointing to firmer manufacturing activity, an expected recovery in services, and a rebound in construction after May’s dip. Such an outcome would translate to Q2 growth of 0.2%, putting the economy on track for 1.2–1.3% expansion in 2025, slightly ahead of the OBR’s 1.0% forecast.
A softer reading would tighten fiscal space for Chancellor Reeves and intensify concerns over the UK’s fiscal “black hole.” For monetary policy, however, the focus remains on inflation, meaning the MPC is unlikely to shift course based on GDP alone.
Corporate Earnings Today: Retail and Tech Lead the Way
Walmart Inc. (WMT)
- Report: Q2 FY2026 earnings
- Time: Before Market Open (BMO)
- Consensus EPS Estimate: $0.74
Context: As the world’s largest retailer, Walmart’s results will be closely watched for signals on U.S. consumer spending patterns, inflation’s impact on households, and the company’s ongoing e-commerce expansion. Investors will be focused on traffic trends, inventory management, and outlook commentary ahead of the holiday season.
Intuit Inc. (INTU)
- Report: Q4 FY2025 earnings
- Time: After Market Close (AMC)
- Consensus EPS Estimate: $2.66
Context: Intuit, the financial software giant behind TurboTax and QuickBooks, will provide insight into digital adoption among individuals and small businesses. Analysts will look for updates on growth in its small-business ecosystem, performance of its AI-driven features, and guidance for FY2026. Strong results could reinforce bullish expectations for demand in fintech solutions despite macroeconomic uncertainty.
Last week, markets were quite volatile once, with gold retreating and then bouncing to finish the week close to $4,000 but yesterday it retreated again. EUR/USD continued the upward move toward 1.17, while main indices closed higher. The moves weren’t too big though, and we opened 35 trading signals in total, finishing the week with 23 winning signals and 12 losing ones.
Gold Finds Support at the 100 Daily SMA
Gold briefly dipped below $3,268/oz following the Fed’s earlier decision to hold rates steady. Yet the downside was limited, with prices rebounding from the 100-day simple moving average and supported by steady labor market fundamentals. Technical indicators suggest the $3,450–$3,500/oz zone remains a critical breakout level for bullish momentum, as safe-haven demand continues to underpin gold’s long-term trajectory.
Yen Recovery from ¥150 Shock
In FX trading, the dollar briefly climbed above ¥150 earlier in the week, driven by yield differentials and Japanese capital outflows. However, profit-taking combined with weak U.S. jobs data strengthened the yen, pulling USD/JPY four yen off its highs. The move highlighted ongoing volatility in currency markets, with traders balancing Fed policy expectations against Japan’s efforts to curb yen weakness.
USD/JPY – Weekly Chart
Cryptocurrency Update
Bitcoin Heading to $112K Support Again
Meanwhile, the cryptocurrency space has remained highly active through the summer months. Bitcoin (BTC) surged to fresh record highs above $123,000 in July and $124,000 in August, buoyed by institutional inflows and technical momentum. Optimism had suggested BTC might challenge the $150,000 mark, but enthusiasm cooled sharply after Treasury Secretary Scott Bessent confirmed the U.S. would not expand its Bitcoin reserves. Combined with hotter-than-expected inflation data, the news sparked a sharp correction, pulling BTC down to $113,000 over the weekend before rebounding above $116,000 yesterday.
BTC/USD – Weekly chart
Ethereum Retreats From Resistance
Ethereum (ETH) has also staged a powerful rally, climbing toward $4,800, its highest level since 2021 and nearing its all-time high of $4,860. Although ETH faced a pullback last week, buyers stepped in at the 20-day simple moving average, fueling a rebound. The rally has been driven by both retail enthusiasm and fresh institutional participation, with bullish technical patterns suggesting further upside potential.
ETH/USD – Daily Chart
Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst.
Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank’s local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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