SECURITY: Russia And US Sent 'Signals' In Putin-Witkoff Meeting - Kremlin

For the full publication, which includes a comprehensive summary of all ECBspeak from the Sintra forum, click here.

The ECB’s annual forum in Sintra, Portugal was held last week, and as usual provided a platform for several Governing Council members to share views around current monetary policy. Amid the noise, the MNI Policy Team’s latest sources piece nicely summarised the mood within the ECB: Officials are virtually unanimous that their June projections are so far being confirmed by incoming data, despite ongoing risks from global trade tensions, paving the way to a likely September cut, though some more cautious policymakers would prefer to wait until December.

• A reminder that the June macroeconomic projections were based on a market curve which embedded one more 25bp cut this cycle, with markets now focused on (1) the timing of this likely cut and (2) the scope for a terminal rate below 1.75%. A July cut appears very unlikely at this stage, with any lingering chance of such a move seemingly requiring an unexpected deterioration on the tariff/trade front.
• The most interesting thread of discussions in Sintra was on the exchange rate, after Vice President de Guindos surprisingly suggested a EURUSD exchange rate above 1.20 would be “complicated” for the Eurozone economy. Although de Guindos also noted that the speed of adjustment in the exchange rate, rather than the level, was most important to monitor, his comments meant that most speakers were asked to weigh in on the currency during the week.
• Belgium National Bank Governor Wunsch struck a more centrist tone than usual in his first comments since the June decision. Usually more hawkish leaning, Wunsch told MNI that “while not expressly calling for a cut myself, I can understand and see why further easing is priced in by financial markets. The risk is probably to the downside”
• Last week also saw the release of the ECB’s latest Strategy Review, and the Minutes of the June decision

• RES 4: 148.65 High May 12 and a reversal trigger 
• RES 3: 148.03 High Jun 23 
• RES 2: 146.19/146.77 High Jun 24 / 76.4% of Jun 23 - Jul1 bear leg 
• RES 1: 145.60 Intraday high
• PRICE: 145.56 @ 13:32 BST Jul 7
• SUP 1: 144.18/142.68 Low Jul 4 / 1   
• SUP 2: 142.12 Low May 27 and a key short-term support 
• SUP 3: 141.96 76.4% retracement of the Apr 22 - May 12 upleg
• SUP 4: 141.49 Low Apr 23    

USDJPY has started the week on a firmer note. Price has breached the 50-day EMA, at 144.91, and a close above it would highlight a stronger reversal. This would expose 146.19, the Jun 24 high. For now, gains still appear corrective. Moving average studies are in a bear-mode position, signalling a dominant downtrend. A resumption of weakness would open 142.12, the May 27 low and a key short-term support.

LLOY (19th Sep) 78c, bought for 3.2 and 3.3 in 25.85k.