This week, the United States has seen mixed economic data, with a sharp drop of 11.3% in month-over-month new home sales in May, hitting a six-month low and indicating a slow recovery in the housing market. Labor market conditions are also loosening, and economic data is showing weakened momentum, increasing the likelihood of a Fed rate cut in September. The release of PCE and University of Michigan consumer confidence index data was generally in line with market expectations. Despite government intervention, the yen continues to be heavily sold in the market, and the euro is weakening with a focus on the dynamics of the French election.
Officials have varying views on the current inflation. The Atlanta Fed President Bostic noted that recent data shows a decrease in the percentage of goods and services with a price increase of over 5%, which is closer to pre-pandemic levels. However, IMF Managing Director Georgieva stated that inflation is expected to return to the Fed’s 2% target by 2025, earlier than the Fed’s own prediction of 2026.
In the crypto market, there is still a high level of anticipation for ETF gaming involving ETH and SOL. VanEck and 21Shares have submitted applications for a Solana ETF, which has caused a short-term surge in SOL prices. However, the probability of a Solana ETF being approved in the short to medium term is estimated to be 0%.
Looking ahead, the upcoming release of S&P and ISM PMI indices in the U.S. and HCOB PMI indices in Europe, as well as the FED meeting minutes and non-farm payroll data, will be important events to monitor. In traditional financial markets, the weakness of the yen and the incompetence of the Japanese and French governments have been the major highlights of the week, contributing to a certain degree of upward momentum for the U.S. dollar.
Overall, the focus in the crypto market remains limited, primarily centered around the anticipation of ETFs for ETH and SOL. The SEC has returned S-1 forms to potential ETH spot ETF issuers, requesting comments to be addressed and resubmitted by July 8. This topic will be further updated in the next weekly report.
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