Friday's U.S. GDP report

White House economic adviser Lawrence Kudlow is expecting a very good number for second-quarter U.S. growth, while one economist has warned that the pace of expansion is close to a peak. Either way, analysts are largely projecting that the main number in Friday’s report on gross domestic product will be a standout. The median estimate of economists is for an annualized growth rate of 4.2%, which would be the fastest since the third quarter of 2014. Projections range from 3% to 5%.

Second-quarter growth will be robust, to be sure, and could potentially top 4%. However, this reflects a number of one-time idiosyncratic factors and should not be viewed as an indication of what is to come in the second half. Growth in the second quarter will be elevated in response to residual seasonality that depressed first-quarter activity.

In currencies, the EUR/USD lost 0.6% after the press conference had started, falling to 1.1670 – the area of this week lows. The euro loses its position against the U.S. dollar and the Swiss franc, despite a number of weak statistics from the United States. The GBP/USD pair peaked at 1.3212 at the beginning of the day, its highest for this week but gave up gains and trimmed all of its weekly gains, partially due to renewed dollar’s strength post-ECB’s decision, and partially due to renewed Brexit-related fears.

In commodities, Gold prices turned lower as the US Dollar returned to the offensive, tarnishing the appeal of anti-fiat alternatives. An early retracement of the prior day’s downswing was compounded by a dovish ECB policy announcement, which sank EUR/USD and echoed as broader support for the greenback. Regarding Oil, prices continued to edge higher, finding continued support in an impressive set of EIA inventory figures. News that Saudi Arabia suspended shipments through the Bab el-Mandeb Strait after Houthi attacks on two of its tankers probably helped as well.

For today important economic release is the Advance GDP q/q.