{"id":81441,"date":"2026-06-17T17:22:26","date_gmt":"2026-06-17T07:22:26","guid":{"rendered":"https:\/\/www.icmarkets.com.au\/blog\/?p=81441"},"modified":"2026-06-17T17:22:29","modified_gmt":"2026-06-17T07:22:29","slug":"ic-markets-europe-fundamental-forecast-17-june-2026","status":"publish","type":"post","link":"https:\/\/www.icmarkets.com.au\/blog\/ic-markets-europe-fundamental-forecast-17-june-2026\/","title":{"rendered":"IC Markets &#8211; Europe Fundamental Forecast | 17 June 2026"},"content":{"rendered":"\n<p><strong>IC Markets &#8211; Europe Fundamental Forecast | 17 June 2026<\/strong><strong><br \/><\/strong><\/p>\n\n\n\n<p><strong>What happened in the Asia session?<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>During today\u2019s Asia session, markets were primarily driven by central bank developments, China-linked macro concerns, and continued fallout from the sharp decline in oil prices following the easing of U.S.-Iran tensions. The biggest macro headline was the policy divergence in Asia after the recent Bank of Japan rate hike to 1.00%, its highest level in decades, while traders also positioned cautiously ahead of the U.S. Federal Reserve decision later today.<br \/><br \/><strong>What does it mean for the Europe &amp; US sessions?<\/strong><strong><br \/><\/strong><br \/>Mix of major macroeconomic catalysts and risk sentiment drivers. The biggest event is the U.S. Federal Reserve policy decision later today, where rates are widely expected to remain unchanged, but markets are highly sensitive to the policy statement, updated rate projections (dot plot), and comments from the Fed Chair for clues on future rate cuts or a more hawkish stance. In the European session, traders are monitoring broader eurozone sentiment and any central bank commentary after recent inflation concerns revived debate around tighter policy.<br \/>\u200b<br \/><strong>The Dollar Index (DXY)<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>Core Retail Sales m\/m (12:30 pm GMT)<br \/><br \/>Retail Sales m\/m (12:30 pm GMT)<br \/><br \/>President Trump Speaks (1:30 pm GMT)<br \/><br \/>Federal Funds Rate (6:00 pm GMT)<br \/><br \/>FOMC Economic Projections (6:00 pm GMT)<br \/><br \/>FOMC Statement (6:00 pm GMT)<br \/><br \/>FOMC Press Conference (6:30 pm GMT)<br \/><br \/><strong>What can we expect from DXY today?<\/strong><\/p>\n\n\n\n<p>The U.S. dollar is trading cautiously today, as markets focus on the outcome of the two-day Federal Reserve meeting, the first under new Fed Chair Kevin Warsh. The Fed is widely expected to keep interest rates unchanged, but traders are closely watching the tone of the statement and press conference for clues on whether policymakers are leaning more hawkish or dovish for the rest of 2026. The dollar has softened slightly ahead of the decision as improving risk sentiment, helped by easing U.S.-Iran tensions and expectations of increased oil supply, reduced safe-haven demand for the greenback.<br \/><br \/><em>Central Bank Notes:<\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Federal Open Market Committee (FOMC) is widely expected to hold the federal funds rate target range steady at 3.50%\u20133.75% at its April 28\u201329, 2026, meeting, as oil prices remain elevated around $108 per barrel for Brent crude amid ongoing US-Israel tensions with Iran, alongside surging inflation from energy shocks, further delaying any 2026 rate cuts potentially beyond September.<\/li>\n\n\n\n<li>The Committee continues to pursue maximum employment and 2% inflation goals, with the labor market showing mixed signals as nonfarm payrolls rose by 178,000 in March 2026\u2014beating lowered expectations but driven partly by strike reversals\u2014and the unemployment rate edged down to 4.3% from 4.4% in February.<\/li>\n\n\n\n<li>Officials face heightened risks from geopolitical tensions, soaring oil prices, and accelerating inflation, with CPI jumping to 3.3% year-over-year in March 2026 from 2.4% in February due to a 10.9% monthly energy surge, headline PCE pressured higher, and core PCE estimates around 3.1% or more.<\/li>\n\n\n\n<li>Economic activity continues to cool after robust Q4 2025 growth near 5%, with the Atlanta Fed GDPNow estimating Q1 2026 growth at 1.3% amid softer consumer spending, strike impacts, and labor data despite some resilience.<\/li>\n\n\n\n<li>March 2026&#8217;s Summary of Economic Projections forecasts 2026 unemployment at a median around 4.4%, GDP growth revised higher, and core PCE up to 2.7%, with the dot plot still signaling one cut in 2026 to a median 3.25%\u20133.50% funds rate amid softer labor but inflation upticks.<\/li>\n\n\n\n<li>The Committee maintains its data-dependent stance amid a mixed labor market, inflation well above target from oil shocks, and geopolitical risks, likely holding rates at 3.50%-3.75% with persistent divisions and hawkish tones on cuts.<\/li>\n\n\n\n<li>The FOMC continues its adjusted quantitative tightening, with Treasury rolloff caps at $5 billion per month and agency MBS at $35 billion per month to manage reserves amid post-2025 balance sheet adjustments.<\/li>\n\n\n\n<li>The FOMC continues its adjusted quantitative tightening, with Treasury rolloff caps at $5 billion per month and agency MBS at $35 billion per month to ensure ample reserves post-2025 program adjustments.<\/li>\n\n\n\n<li>The next meeting is scheduled for 16 to 17\u00a0 June 2026.<\/li>\n<\/ul>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><br \/>Medium Bullish<\/p>\n\n\n\n<p><strong>Gold (XAU)<\/strong><strong><br \/><\/strong><strong><br \/><\/strong><strong>Key news events today<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>Core Retail Sales m\/m (12:30 pm GMT)<\/p>\n\n\n\n<p>Retail Sales m\/m (12:30 pm GMT)<\/p>\n\n\n\n<p>President Trump Speaks (1:30 pm GMT)<\/p>\n\n\n\n<p>Federal Funds Rate (6:00 pm GMT)<\/p>\n\n\n\n<p>FOMC Economic Projections (6:00 pm GMT)<\/p>\n\n\n\n<p>FOMC Statement (6:00 pm GMT)<\/p>\n\n\n\n<p>FOMC Press Conference (6:30 pm GMT)<\/p>\n\n\n\n<p><strong>What can we expect from Gold today?<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>Gold prices are trading slightly bullish\/mixed today, Wednesday, as traders balance safe-haven demand against expectations from today\u2019s highly anticipated U.S. Federal Reserve interest rate decision. Gold edged higher during the Asian and European sessions, supported by easing fears of aggressive rate hikes and continued central bank buying, while investors remain cautious ahead of the Fed statement and comments from Chair Kevin Warsh.<\/p>\n\n\n\n<p><br \/><strong>Next 24 Hours Bias&nbsp; &nbsp; <\/strong><strong><br \/><\/strong>Weak Bearish<\/p>\n\n\n\n<p><strong>The Euro (EUR)<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><br \/><\/p>\n\n\n\n<p>ECB President Lagarde Speaks (10:50 am GMT)<\/p>\n\n\n\n<p><strong>What can we expect from EUR toda<\/strong>y?<br \/><br \/>The euro is seeing medium bullish support today, Wednesday, mainly due to a more hawkish tone from the European Central Bank (ECB) and persistent inflation pressures in the Eurozone. ECB officials signaled they remain ready to keep policy tight or even raise rates further if inflation stays elevated, despite easing oil prices after recent geopolitical developments in the Middle East. ECB Chief Economist Philip Lane said the central bank will remain proactive against inflation, while policymakers continue to leave the door open for additional tightening later in 2026.<\/p>\n\n\n\n<p><br \/><em>Central Bank Notes:<\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Governing Council is expected to maintain the three key rates unchanged at their June levels into July, with the main refinancing rate around 2.15%, the marginal lending facility at 2.40%, and the deposit facility at 2.00%. Policy remains on a meeting\u2011by\u2011meeting, data\u2011dependent footing.<\/li>\n\n\n\n<li>Real GDP growth is expected to be modest: around 0.9% for 2026, 1.3% for 2027, and 1.4% for 2028. Quarterly momentum implies roughly 0.2\u20130.3% q\/q growth in Q2 2026, consistent with resilience seen late\u20112025.<\/li>\n\n\n\n<li>Balance\u2011sheet normalization continues smoothly. APP and PEPP wind\u2011downs are effectively completed; the Eurosystem is allowing remaining longer\u2011dated holdings to run off. No material liquidity shortages are expected; the Governing Council will monitor transmission and market functioning closely.<\/li>\n\n\n\n<li>Upside risks: stronger\u2011than\u2011expected services inflation persistence, renewed energy or commodity price shocks, and tighter global financial conditions that transmit unevenly.<\/li>\n\n\n\n<li>The ECB is likely to keep policy rates on hold while emphasizing data dependence: future moves will be guided by incoming HICP prints, wage dynamics, and indicators of monetary transmission (credit, deposit flows, and market functioning).<\/li>\n\n\n\n<li>With rates expected to be on hold and inflation slightly above target for 2026, the EUR may trade with two\u2011way volatility; upside for EUR if euro\u2011area data surprise to the upside or if US data weaken relative to euro\u2011area, but limited unilateral appreciation given symmetric policy risks.<\/li>\n\n\n\n<li>Curve pricing should reflect a prolonged period of unchanged rates with modest probability of hikes if upside inflation surprises continue; front-end stays anchored, while longer\u2011dated yields respond to inflation\u2011expectation movements and global risk sentiment.<\/li>\n<\/ul>\n\n\n\n<p>\u200bThe next meeting is on 22 to 23 July 2026<\/p>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><br \/>Weak Bearish<\/p>\n\n\n\n<p><strong>The Swiss Franc (CHF)<\/strong><strong><br \/><\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from CHF today?<\/strong><strong><br \/><\/strong><br \/>The Swiss franc (CHF) is seeing mixed but slightly supportive momentum today, as traders focus on tomorrow\u2019s Swiss National Bank (SNB) policy decision and continued safe-haven demand. Markets broadly expect the SNB to keep interest rates unchanged at 0.00% on 18 June, mainly because Swiss inflation remains low and contained. However, geopolitical tensions and risk aversion have continued to support the franc as investors seek safer currencies during uncertainty.<br \/><br \/><em>Central Bank Notes:<\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>At its monetary policy assessment on 19 March 2026, the Swiss National Bank (SNB) is widely expected to leave the policy rate unchanged at 0%, continuing the extended pause since September 2025, as the Governing Board considers current settings adequate to keep inflation near the target without resorting to negative rates.<\/li>\n\n\n\n<li>Inflation data since December indicate persistent weakness, with headline CPI hovering around 0% year-on-year through early 2026 and core measures subdued at roughly 0.4%, underscoring limited price pressures and lingering, though contained, deflation risks.<\/li>\n\n\n\n<li>The SNB\u2019s updated conditional inflation forecast shows minimal change from December, with averages of about 0.2% in 2025 (now complete), 0.3% in 2026, and 0.6% in 2027 under a steady 0% policy rate. However, recent flat CPI readings may slightly lower near-term expectations, preserving scope for further easing if needed.<\/li>\n\n\n\n<li>Global conditions remain challenging, marked by U.S. tariff escalations under President Trump, subdued external demand, and uncertainties in major export markets such as Europe and the U.S., prompting the SNB to exercise caution despite resilient Swiss domestic activity.<\/li>\n\n\n\n<li>Sentiment in manufacturing and export sectors stays soft amid franc appreciation and weaker foreign orders, squeezing margins. Yet, overall GDP growth is expected to be around 1.5% in 2026, with unemployment edging up modestly from historic lows.<\/li>\n\n\n\n<li>The SNB reaffirms its readiness to intervene via rate cuts or FX operations should deflationary pressures intensify, while emphasizing clear communication through detailed meeting minutes and coordination with global partners on currency matters.<\/li>\n<\/ul>\n\n\n\n<p><br \/>The next meeting is on 18 June 2026.<\/p>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><br \/>Medium Bullish<\/p>\n\n\n\n<p><strong>The Pound (GBP)<\/strong><strong><br \/><\/strong><strong><br \/><\/strong><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from GBP today?<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>The British Pound (GBP) is trading cautiously today, as markets focus heavily on UK inflation data and the upcoming Bank of England interest rate decision on Thursday. Sterling has remained relatively stable against the US dollar after optimism surrounding easing Middle East tensions helped calm energy markets and reduced inflation fears linked to oil prices. However, traders are closely watching UK CPI figures released today, as stronger-than-expected inflation could strengthen the pound by increasing expectations of a more hawkish tone from the BoE, while softer data may pressure GBP lower.<\/p>\n\n\n\n<p><em>Central Bank Notes:<\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The Bank of England\u2019s Monetary Policy Committee (MPC) met on 29 April 2026, maintaining the Bank Rate at 3.75 per cent, with the decision details published on 30 April 2026 alongside the quarterly Monetary Policy Report. This hold follows the unanimous 9-0 vote at the prior 18 March 2026 meeting, amid persistent energy shocks from the Middle East conflict overriding earlier cut expectations. No specific vote split for April has been detailed yet, but consensus previews indicate a hold.<\/li>\n\n\n\n<li>Quantitative tightening (QT) continues unchanged at the 2025 pace for gilt holdings reductions, supporting balance-sheet normalization while monitoring liquidity and maintaining restrictiveness against ongoing shocks.<\/li>\n\n\n\n<li>Headline CPI inflation rose to 3.3% in March 2026 from energy and motor fuel surges due to Middle East tensions, expected to stay between 3% and 3.5% through the summer, well above the 2% target. The April Monetary Policy Report outlines scenarios in which inflation peaks above 3.5% by the end of 2026 in the baseline, then eases below 2% in three years, or reaches 6%+ in adverse cases requiring tighter policy.<\/li>\n\n\n\n<li>UK growth outlook weakens further into Q2-Q3 2026 amid energy-driven cost pressures, rising unemployment risks, and softening confidence, with prior pay growth cooling now vulnerable to business pass-throughs.<\/li>\n\n\n\n<li>Global risks from the Middle East conflict persist, fueling energy\/commodity volatility and sterling\/gilt fluctuations; MPC views direct impacts as containable if demand slackens to curb secondary inflation effects.<\/li>\n\n\n\n<li>Inflation risks remain upward-biased due to energy persistence, potential wage embedding, and shock duration uncertainty, balanced against downside from economic slack and labor market softening.<\/li>\n\n\n\n<li>The MPC maintains a data-dependent stance, with policy still restrictive; the April Report provides fuller shock analysis, but no easing is signaled, yet members monitor for 2% sustainability, with Governor Bailey emphasizing vigilance.<\/li>\n\n\n\n<li>The next meeting is on 18 June 2026.<br \/><br \/><strong>Next 24 Hours Bias<\/strong><strong><br \/><\/strong>Medium Bearish<\/li>\n<\/ul>\n\n\n\n<p><strong><br \/><\/strong><strong><br \/><\/strong><strong>The Canadian Dollar (CAD)<\/strong><strong><br \/><\/strong><strong><br \/><\/strong><strong>Key news events today<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>No major news event&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<\/p>\n\n\n\n<p><strong>What can we expect from CAD today?<\/strong><\/p>\n\n\n\n<p>The Canadian dollar (CAD) is facing moderate downside pressure today, mainly due to softer oil prices, cautious signals from the Bank of Canada (BoC), and continued strength in the U.S. dollar. The loonie has remained near a seven-month low against USD, with lower crude prices reducing support for Canada\u2019s commodity-linked currency after easing geopolitical tensions pushed oil lower earlier this week.<br \/>\u200b<br \/>Central Bank Notes:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>At its 10 June 2026 meeting, the Governing Council maintained the overnight rate target at 2.25%, continuing the policy pause begun earlier in the year. The decision matched market expectations and reflected the Committee\u2019s assessment that the current stance remains appropriately restrictive to secure 2% inflation over the policy horizon.<\/li>\n\n\n\n<li>The Bank noted persistent global headwinds: geopolitical tensions in the Middle East and renewed U.S. trade friction continue to weigh on sentiment and supply chains. These risks are asymmetric and could slow foreign demand or push commodity price volatility higher.<\/li>\n\n\n\n<li>Real GDP growth is estimated to have continued into Q2 at roughly a 2.0\u20132.3% annualized pace, broadly consistent with the Bank\u2019s April projection of sustained momentum. Strength remained concentrated in resource shipments and exports, supported by robust global energy demand, while business investment showed only tentative improvement.<\/li>\n\n\n\n<li>The labour market remains tight but is showing early signs of rebalancing: employment growth continued, and the unemployment rate stayed near recent lows, but wage growth has moderated from its peak. Participation edged up modestly in some regions, consistent with slower wage pressure ahead.<\/li>\n\n\n\n<li>\u200bHeadline CPI remained close to 2.0% year-over-year in April\u2013May prints, within the inflation target band. Core indicators\u2014CPI-trim, CPI-median, and a trimmed mean\u2014tracked around 2.3\u20132.6%, showing modest further easing compared with earlier in the year.<\/li>\n\n\n\n<li>Manufacturing PMI remained in expansionary territory into May, supported by export orders and healthy energy-sector activity. Firms reported steady demand for intermediate goods, though capex intentions remain cautious.<\/li>\n\n\n\n<li>Credit growth continued at a moderate pace. Bank lending spreads and deposit dynamics showed limited pass-through from global tightening episodes. Mortgage rates remain somewhat elevated but stable, underpinning the observed moderation in housing activity.<\/li>\n\n\n\n<li>The next meeting is on 16 July 2026.<\/li>\n<\/ul>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><br \/>Weak Bearish<\/p>\n\n\n\n<p><strong>Oil<\/strong><strong><br \/><\/strong><strong><em><br \/><\/em><\/strong><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>EIA Crude Oil Inventories ( 2:30 pm GMT)<br \/><strong><br \/><\/strong><strong>What can we expect from Oil today?<\/strong><\/p>\n\n\n\n<p>Oil prices are under pressure today, as markets react to growing expectations of increased global supply following progress toward a U.S.\u2013Iran agreement that could reopen the Strait of Hormuz and allow Iranian oil exports to resume. Brent crude briefly traded below the $80 level, while WTI hovered in the mid-$70s after several consecutive sessions of declines. Investors are closely watching developments around the proposed deal, as any return of Iranian barrels to the market could significantly ease supply concerns that previously drove prices higher during the Middle East conflict.<\/p>\n\n\n\n<p><br \/><strong>Next 24 Hours Bias<\/strong><strong><br \/><\/strong>Medium&nbsp; Bearish<\/p>\n","protected":false},"excerpt":{"rendered":"<p>IC Markets &#8211; Europe Fundamental Forecast | 17 June 2026 What [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":79417,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[196,215,339],"tags":[],"class_list":["post-81441","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fundamental-analysis","category-market-analysis","category-recent-posts"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts\/81441","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/comments?post=81441"}],"version-history":[{"count":2,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts\/81441\/revisions"}],"predecessor-version":[{"id":81467,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts\/81441\/revisions\/81467"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/media\/79417"}],"wp:attachment":[{"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/media?parent=81441"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/categories?post=81441"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/tags?post=81441"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}