The US Dollar began to recover in early European trading on Wednesday (July 2, 2025), although negative sentiment continues to linger. Market participants are closely monitoring the proposed legislation aimed at expenditure cuts, referred to as the One Big Beautiful Bill Act.
The US Senate has already passed the bill, and it is currently with the House of Representatives for a vote, expected to occur as early as Wednesday morning local time or tonight. This development is likely to have a significant impact on the financial markets, alongside the release of ADP labor data at 19:15 WIB.
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Forecasts from Trading Central suggest that the job creation figures for June will show an increase of 90,000, significantly higher than the previous month’s figure of 37,000.
GOLD
The price of Gold (XAUUSD) has remained relatively stable at the beginning of the European session, fluctuating between $3,327 and $3,345 per troy ounce. This trend indicates that traders are awaiting updates regarding the One Big Beautiful Bill Act.
The bill is expected to exacerbate the fiscal deficit and increase US debt, causing concerns among traders regarding the long-term economic outlook for the country. The Congressional Budget Office (CBO) projects that if the bill is enacted, the US fiscal deficit may rise by $3.8 trillion over the next decade.
Should the bill pass through the House of Representatives, Gold could potentially benefit from positive sentiment. The release of ADP data will also influence Gold’s price movements.
OIL
Oil prices (CLS10) rose at the start of the European session, reaching a daily high of $66.27 per barrel. Oil prices increased after Iran expressed unwillingness to cooperate with the International Atomic Energy Agency (IAEA) under the United Nations.
Iran stated that the agency is biased towards Western interests and that any inspections of its nuclear facilities would require approval from Tehran’s Supreme National Security Council.
This development has slightly heightened tensions in the Middle East, contributing to an Oil price rebound. This sentiment is expected to continue affecting Oil price movements in the evening trading session.
EURUSD
EURUSD experienced a decline at the start of the European session, hitting a daily low of 1.17648. Compared to Tuesday’s closing prices, EURUSD fell by 382 points (38.2 pips).
The drop in EURUSD is attributed to profit-taking following a sharp rise over recent weeks, bringing it close to its highest level since September 2021. If ADP data released later tonight exceeds expectations, the profit-taking in EURUSD may persist before attention shifts back to discussions regarding the One Big Beautiful Bill Act.
GBPUSD
Similarly, the GBPUSD pair decreased by 528 points (52.8 pips) at the start of the European session to 1.36877. Profit-taking also triggered the drop in GBPUSD, considering its position is still near its highest levels since October 2021.
This situation may lead GBPUSD to experience profit-taking in tonight’s trading if the ADP figures are released more favorably than forecasted.
USDJPY
USDJPY rose by more than 900 points (90 pips) at the beginning of the European session, reaching 144.243, successfully reversing Tuesday’s decline.
This movement indicates that market participants are awaiting developments on the One Big Beautiful Bill Act, especially since President Donald Trump has called for its resolution by the Fourth of July.
The ADP data release will also affect USDJPY’s movements; if it exceeds forecasts, USDJPY may gain positive sentiment.
Nasdaq
Nasdaq reversed course, dropping to 22,672 after briefly rising to 22,780 earlier in the day. This movement indicates that market participants are still digesting the implications of the bill, particularly its potential impact on corporate performance.
Consequently, Nasdaq is expected to remain volatile and may face profit-taking, especially given its current position near all-time highs.
