European session: BOE minutes justified expectations[E]

Next data issued:

06:45 FR Consumer spending (May) 0.6% -0.2% 0.7%

The dollar declined for a second day on speculation further interest-rate increases by the Federal Reserve will promote the U.S economy slowdown.

The euro advanced after European Central Bank President Jean-Claude Trichet. He said that inflationary pressure remains in region though 2007.

Main today’s event was June BOE minutes. However, they have not surprised the market. According to minutes the majority of committee members supported preservation of interest rate at a level 4.5% which is supported for 10 months. First-time voter has adjoined to the majority, who has replaced Stephen Nickell in MPC - David Blanchflower, which position the market observed with interest. Policy makers voices divided in ratio 7- 1 from reports of session published today. David Walton voted for rate increase to 4.75% as well as at the previous session in May.

Reports showed, rates of economic growth for last month as a whole corresponded to last forecasts of Committee on monetary and credit policy of BOE which have been presented in inflation quarterly report in the middle of May. The exception which is worthy, became a situation in the international financial markets where for the previous month was essential decrease of securities’ quotations.

EUR/USD consolidated in a range $1.2510/40.

GBP/USD after consolidation in a range $1.8450/60 fell to $1.8410. It could not overcome this level and the rate has stabilized near session lows.

USD/JPY remained in a range Y114.60/90.

Today it is not expected important economic reports. Currencies will hardly leave developed ranges. Trades will be defined by technical view.