Uncertain days for the dollar
Thursday U.S. labor market data confirmed investors’ concerns about the dollar’s condition
The report showed a clear slowdown in employment growth in the United States in June, weakening expectations for further interest rate hikes by the Federal Reserve.
As a result, the U.S. currency fell under pressure and lost value.
Non-agricultural employment rose in June by 57 thousand, well below market expectations of 110 thousand.
Even greater disappointment came from private sector data, where the number of new jobs increased by 49 thousand versus projected 110 thousand.
At the same time, May data were revised. Ultimately, non-agricultural employment grew by 129 thousand, and private sector employment by 97 thousand.
The positive highlight of the report was the unemployment rate, which fell to 4,2% in June from 4.3% a month earlier.
Investors now expect the Fed to raise borrowing costs by a quarter percentage point by December, not as previously assumed – to October.
This remains a radical shift from the situation before the war’s outbreak at the end of February, when investors expected the Fed to lower rates in 2026.
Rising oil prices and increasing inflation expectations regularly complicate monetary policy forecasts.
Additionally, reports of the conflict between the U.S. and Iran increase market uncertainty and pressure U.S. currency prospects.
U.S. and Iranian officials concluded another round of negotiations held in Qatar.
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The agency Reuters, citing anonymous sources familiar with the matter, reported that negotiators discussed key issues, pledging to return to talks soon.
As the spokesperson for the Qatari Ministry of Foreign Affairs, Majed al-Ansari, said, Iran is preparing for the funeral ceremonies of the late Supreme Leader of Iran, Ali Khamenei, scheduled for 4-9 July.
On Thursday, the commander of Iran’s Central Headquarters Khatam al-Anbiya, Ali Abdollahi Aliabadi, warned the United States and Israel against any military actions against Iran at that time.
“We warn Iran’s enemies, especially the United States and the Zionist regime, to avoid miscalculations and keep in mind the harsh retaliatory actions our armed forces will take in response to any threat and aggression against our country,” he said.
A similar warning was issued by Iranian foreign minister, Abbas Araghchi.
Iranian media report the introduction of extraordinary security measures during funeral ceremonies, which may include temporary restrictions in airspace.
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Dollar and euro rates on Friday, July 3
The dollar to zloty rate on Friday, July 3 is at 3,73 PLN after a drop of 3 cents.
Chart. Dollar to zloty rate (USD/PLN)
Source: Trading Economics.
The euro to dollar rate after a slight strengthening reaches 1,14 USD.
Chart. Euro to dollar rate (EUR/USD)
Source: Trading Economics.
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Sources: Reuters,
