Market Information Friday 4 July 2025

The U.S. trade deficit rose sharply in May, driven by a significant drop in exports while imports remained stable. The deficit increased by 18.7% to $71.5 billion. Exports fell by 4.0% to $279.0 billion, while imports remained unchanged at $350.5 billion. The U.S. trade deficit with the European Union was $22.5 billion, and with China, it stood at $14.0 billion.

The U.S. labor market added 147,000 jobs in June, exceeding expectations, while the unemployment rate fell to 4.1%. Markets had expected 110,000 new jobs and an unemployment rate of 4.3%. May’s job growth was revised from 139,000 to 144,000, and April’s from 147,000 to 158,000. The labor force participation rate remained at 62.3%, and average hourly earnings rose by $0.08 to $36.30, marking annual wage growth of 3.7%, down from 3.9% in May. This positive report follows a surprisingly weak ADP report, which showed a loss of 33,000 private-sector jobs in June.

The eurozone services PMI rose from 49.7 in May to 50.5 in June, reaching a three-month high, indicating modest growth. The manufacturing PMI increased slightly from 49.4 to 49.5, the highest level in 34 months. As a result, the composite PMI rose from 50.2 to 50.6. Despite this improvement, economists remain cautious about a strong recovery in the European services sector. Expectations for the next 12 months have improved but remain below the long-term average. Rising service sector prices and input costs are a concern for the ECB, though the strong euro and deflationary effects of U.S. import tariffs may ease these concerns. A PMI above 50 signals growth; below 50 signals contraction.

The 6M Euribor decreased with 2 basis points to 2.03% compared to previous business day. The 10Y Swap decreased with 4 basis points to 2.58% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.