What awaits us in the week? What can the euro exchange rate and the dollar exchange rate react to?

In the coming week, in the United States, investors will focus on the results of stress tests of banks and data on Americans' personal income and spending, as well as PCE price indices.

It will also be important to track durable goods orders, the final GDP growth reading, the Michigan Consumer Confidence Index and new and pending home sales.

In addition, several representatives of central banks, including the chairman Fed Jerome Powell and the president ECB Christine Lagarde will attend the ECB Central Banking Forum in Portugal.

Expectations regarding data from the US that may affect the dollar exchange rate

The U.S. Personal Income and Spending Report is expected to show a slowdown in consumer spending growth to 0,2%, while income growth is stable at 0,4%. In turn, the PCE price index, which is the Federal Reserve's preferred measure of inflation, is likely to show a slight easing of inflationary pressures in May.

Additionally, orders for durable goods are expected to drop for the first time in 3 months. It will also be important to track other key data such as new and pending home sales, home prices S&P/Case-Shiller, the Chicago region PMI, the Dallas Fed manufacturing index, preliminary estimates of trade balances and wholesale inventories, final first-quarter GDP readings, and the Michigan Consumer Sentiment Index for June.

Investors will also be keeping a close eye on the results of the bank stress tests, which will be released by the Federal Reserve on Wednesday, to gauge the resilience of the banking sector. Additionally, investors will focus on Canada's monthly GDP and inflation figures.

Flash inflation readings from European economies may affect the euro exchange rate

In Europe, investors can focus on the release of flash inflation figures for the Eurozone, Germany, France, Italy and Spain. Eurozone consumer price inflation is projected to continue to decline, reaching 5,6% in June, the lowest level since January 2022. However, the annual core inflation rate is set to rebound, accelerating to 5,5% from 5,3% in May.

In Germany, special attention was paid to ifo economic climate index, which is expected to fall to its lowest level in five months. The GfK Consumer Climate Index is set to increase for the eighth month in a row, reaching its highest level since April 2022.

In addition, the results of business surveys and the unemployment rate for the euro zone, as well as data on retail sales and the unemployment rate in the euro area will be published Germany, as well as retail trade data and leading KOF indexes in Switzerland.

In the UK, final first quarter GDP figures, monetary indicators, current account balance, Nationwide house prices and CBI trade data will be released.

In addition, prominent central bankers such as ECB President Christine Lagarde and Fed Chairman Jerome Powell will attend the ECB Central Banking Forum in Portugal.

Data from China and Japan will be of interest

In Asia, all eyes will be on China's manufacturing PMI in June for the latest on economic recovery since lockdowns ended in February. In Japan, a busy week of economic data releases will be led by Consumer Confidence Index for June, following May's Unemployment Rate, Industrial Production, Retail Sales and Opinion Summary Bank of Japan.

To all this, it is worth adding that this week ends the month, quarter and half-year, which may also affect the rebalancing of positions in fund portfolios, and this may lead to greater volatility in the second half of the week, which may occur even without the influx of data or information and will only result from the transfer of funds within the funds.