{"id":82056,"date":"2026-07-13T17:59:49","date_gmt":"2026-07-13T07:59:49","guid":{"rendered":"https:\/\/www.icmarkets.com.au\/blog\/?p=82056"},"modified":"2026-07-13T17:59:51","modified_gmt":"2026-07-13T07:59:51","slug":"ic-markets-europe-fundamental-forecast-13-july-2026","status":"publish","type":"post","link":"https:\/\/www.icmarkets.com.au\/blog\/ic-markets-europe-fundamental-forecast-13-july-2026\/","title":{"rendered":"IC Markets &#8211; Europe Fundamental Forecast | 13 July 2026"},"content":{"rendered":"\n<p><strong>IC Markets &#8211; Europe Fundamental Forecast | 13 July 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>The dominant market headline was renewed Middle East tension, which kept crude oil supported and weighed on risk sentiment across regional equities. The main macro focus in Asia was China\u2019s June CPI\/PPI releases from July 10, which fed into China-sensitive assets and broader commodities\/FX positioning, while Japan\u2019s week-ahead calendar was otherwise relatively light for today\u2019s session.<br \/><br \/><strong>What does it mean for the Europe &amp; US sessions?<\/strong><strong><br \/><\/strong><br \/>Traders should focus on risk sentiment driven by Middle East headlines, with stock futures under pressure and Asian markets showing spillover stress; that backdrop is likely to set the tone for equities, oil, and safe-haven flows at the open. In Europe, financials and payments names are in focus after reports that Mastercard is exploring a sale of a majority stake in Vocalink, while banks including Deutsche Bank and UniCredit are suing Linde over Russia-sanctions-related losses.<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>No major news event<br \/><br \/><strong>What can we expect from DXY today?<\/strong><\/p>\n\n\n\n<p>Today, Monday, the U.S. dollar is gaining on safe-haven demand after fresh Middle East tensions and fears around oil supply disruption pushed investors toward the greenback. The move looks broad-based rather than isolated to one currency pair, and the dollar index reading around 101.06 shows the currency is starting the week on a firmer footing.<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) left the federal funds rate unchanged at 3.50%\u20133.75% at its June 16\u201317, 2026, meeting, marking another pause in the policy cycle. Under new Fed Chair Kevin Warsh, policymakers signaled a more cautious and hawkish stance as inflation remains above target despite moderating energy prices.<\/li>\n\n\n\n<li>The Committee remains committed to achieving maximum employment and returning inflation to its 2% objective. Labor market conditions have remained relatively stable, with job gains continuing at a moderate pace and the unemployment rate projected to remain near 4.4% through 2026.<\/li>\n\n\n\n<li>Inflation continues to be the primary concern for policymakers. Headline inflation remains elevated, supported by earlier energy-related price pressures and persistent services inflation. The June projections showed higher inflation forecasts than previously expected, leading several officials to favor keeping policy restrictive for longer.<\/li>\n\n\n\n<li>Economic activity continues to expand at a moderate pace. Productivity growth, capital investment, and AI-related spending remain supportive of growth, while consumer spending and housing activity show signs of slowing compared with late 2025 and early 2026.<\/li>\n\n\n\n<li>The June 2026 Summary of Economic Projections (SEP) revealed a more divided Committee. Nine officials projected at least one rate hike during 2026, while others expected rates to remain unchanged or eventually decline. The median outlook shifted toward a higher-for-longer policy path compared with earlier projections.<\/li>\n\n\n\n<li>The Committee emphasized a data-dependent approach and noted that future decisions will depend on incoming inflation, employment, and economic growth data. Officials acknowledged that geopolitical developments and energy markets remain important upside risks to inflation.<\/li>\n\n\n\n<li>The FOMC continues its balance sheet normalization program, maintaining Treasury runoff caps at $5 billion per month and agency mortgage-backed securities (MBS) runoff caps at $35 billion per month, while ensuring ample reserves remain in the banking system.<\/li>\n\n\n\n<li>The next meeting is scheduled for 28 to 29\u00a0 July 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>No major news event)<\/p>\n\n\n\n<p><strong>What can we expect from Gold today?<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>Gold prices started the week under pressure on Monday, as investors weighed escalating geopolitical tensions in the Middle East against expectations that global interest rates, particularly in the United States, could remain elevated for longer. Although renewed U.S.\u2013Iran tensions and disruptions around the Strait of Hormuz initially boosted safe-haven demand, the stronger U.S. dollar and higher Treasury yields limited gold&#8217;s upside, with spot prices slipping during the Asian session.<\/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><\/p>\n\n\n\n<p>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from EUR toda<\/strong>y?<br \/><br \/>The euro begins the week supported by expectations that the European Central Bank (ECB) may need to keep monetary policy tighter for longer as renewed geopolitical tensions have pushed energy prices higher, reinforcing inflation concerns across the euro area. Recent ECB meeting accounts showed policymakers expect inflation to remain above target into 2027 despite the June rate increase, leading markets to price in additional tightening if price pressures persist.<\/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 the EUR if euro\u2011area data surprise to the upside or if US data weaken relative to the 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 \/>Strong 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 begins the week with markets continuing to assess the Swiss National Bank&#8217;s (SNB) dovish stance following its June policy meeting, where it kept its policy rate unchanged at 0.00% and reaffirmed its willingness to intervene in foreign exchange markets if excessive franc strength returns. Investors remain focused on the divergence between the SNB and the U.S. Federal Reserve, whose relatively hawkish outlook has widened interest-rate differentials and supported the U.S. dollar against the franc over recent weeks.<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 18 June 2026, the Swiss National Bank left the SNB policy rate unchanged at 0.00%, in line with market expectations. Policymakers maintained that the current policy setting remains appropriate given low inflation and ongoing global economic uncertainty.<\/li>\n\n\n\n<li>Inflation remains exceptionally subdued in Switzerland. Recent data show consumer price growth staying comfortably within the SNB&#8217;s price stability range, with headline inflation around 0.6% year-on-year in May 2026, while underlying inflation pressures remain limited despite higher global energy prices.<\/li>\n\n\n\n<li>The SNB continues to view medium-term inflation pressures as largely unchanged. While energy prices linked to Middle East tensions have temporarily lifted near-term inflation expectations, the stronger Swiss franc has helped offset imported inflation, supporting the central bank&#8217;s decision to maintain rates at current levels.<\/li>\n\n\n\n<li>External risks remain elevated. Policymakers highlighted ongoing geopolitical tensions, trade uncertainties, and slower global growth prospects, particularly in key export markets such as the Eurozone and the United States. These factors continue to warrant a cautious policy approach.<\/li>\n\n\n\n<li>Swiss economic activity remains resilient but modest. GDP growth is expected to remain around 1\u20131.5% in 2026, supported by domestic demand, although manufacturing and export-oriented sectors continue to face challenges from a strong franc and softer foreign demand.<\/li>\n\n\n\n<li>The SNB reiterated its readiness to act if necessary. The Governing Board emphasized that it remains willing to intervene in foreign exchange markets to counter excessive Swiss franc appreciation and stands prepared to adjust policy should inflation or economic conditions deviate materially from expectations.<\/li>\n<\/ul>\n\n\n\n<p><br \/>The next meeting is on 24 September 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 begins the week on a cautious footing after giving back part of last week&#8217;s gains, with GBP\/USD trading around the 1.3380 area. The pullback comes as renewed geopolitical tensions in the Middle East have increased demand for the U.S. dollar as a safe-haven currency, while traders also await this week&#8217;s UK economic data, particularly the monthly GDP report, which could significantly influence expectations for the next Bank of England policy decision.<\/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 17\u201318 June 2026 and voted 7\u20132 to maintain the Bank Rate at 3.75%. Two members, Megan Greene and Chief Economist Huw Pill, voted for a 25-basis-point increase to 4.00%, citing concerns about inflation expectations and the risk of persistent price pressures. The majority favored keeping policy unchanged while assessing the evolving impact of recent energy-market developments.<\/li>\n\n\n\n<li>Quantitative tightening (QT) continues as planned, with the Bank maintaining its balance-sheet reduction strategy through gilt runoff and sales. The MPC considers QT an important part of policy normalization while preserving sufficient liquidity in financial markets.<\/li>\n\n\n\n<li>Inflation remains above target despite some easing in energy prices. The Bank expects CPI inflation to remain around or above 3% during the second half of 2026, compared with the 2% target. While recent declines in oil and gas prices have reduced the near-term inflation outlook, policymakers remain concerned about potential second-round effects through wages and services inflation.<\/li>\n\n\n\n<li>UK economic growth remains subdued. The MPC noted signs of weakening demand, falling vacancies, and a softer labor market, although recent wage growth data came in slightly stronger than expected. The Committee expects economic activity to remain modest as higher borrowing costs and uncertainty continue to weigh on business investment and consumer spending.<\/li>\n\n\n\n<li>Global risks remain elevated, particularly due to developments in the Middle East and their potential effects on energy markets, trade flows, and financial conditions. Although tensions have eased somewhat following diplomatic progress, policymakers continue to monitor commodity-price volatility and its implications for UK inflation.<\/li>\n\n\n\n<li>Inflation risks remain tilted to the upside. The MPC highlighted concerns that higher inflation expectations, resilient wage growth, and renewed energy-price shocks could require a more restrictive policy stance. However, downside risks from weaker growth and increasing economic slack offset this influence.<\/li>\n\n\n\n<li>The MPC continues to emphasize a data-dependent and restrictive policy stance, with no commitment to either rate cuts or hikes in the near term. Governor Andrew Bailey stated that policymakers will remain vigilant and stand ready to respond if inflation proves more persistent than expected. The presence of two votes for a rate increase demonstrates that the Committee remains alert to upside inflation risks.<\/li>\n\n\n\n<li>The next meeting is on 30 July 2026.<br \/><br \/><strong>Next 24 Hours Bias<\/strong><strong><br \/><\/strong>Weak Bullish<\/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<\/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) begins Monday under mixed pressure as markets react to a sharp escalation in Middle East tensions after renewed U.S. strikes against Iran and reports that the Strait of Hormuz has been closed, sending crude oil prices sharply higher. While stronger oil prices are typically supportive for the commodity-linked Canadian dollar, the broad-based strength of the U.S. dollar as investors seek safe-haven assets has outweighed that benefit, pushing USD\/CAD modestly higher during the Asian session.<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>No major news event<br \/><strong><br \/><\/strong><strong>What can we expect from Oil today?<\/strong><\/p>\n\n\n\n<p>Oil prices are trading significantly higher as renewed military conflict between the United States and Iran has reignited concerns over crude supply disruptions through the Strait of Hormuz. The geopolitical escalation has overshadowed recent expectations of improving supply, prompting investors to price in a larger risk premium. However, gains may be tempered by OPEC+&#8217;s continued production increases scheduled for August and concerns over global demand. The market&#8217;s focus this week will remain on developments in the Middle East, shipping activity through the Gulf, and key U.S. economic data, all of which are likely to drive oil price volatility in the coming sessions.<\/p>\n\n\n\n<p><br \/><strong>Next 24 Hours Bias<\/strong><strong><br \/><\/strong>Weak Bullish<\/p>\n","protected":false},"excerpt":{"rendered":"<p>IC Markets &#8211; Europe Fundamental Forecast | 13 July 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":[196,339],"tags":[],"class_list":["post-82056","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-fundamental-analysis","category-recent-posts"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts\/82056","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=82056"}],"version-history":[{"count":1,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts\/82056\/revisions"}],"predecessor-version":[{"id":82057,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/posts\/82056\/revisions\/82057"}],"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=82056"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/categories?post=82056"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.icmarkets.com.au\/blog\/wp-json\/wp\/v2\/tags?post=82056"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}